Customer Experience & Fraud Prevention: Dueling Priorities for Today’s Contact Centers

Customer Experience & Fraud Prevention: Dueling Priorities for Today’s Contact Centers

/ Technology, Data Security
Customer Experience & Fraud Prevention: Dueling Priorities for Today’s Contact Centers

How to deliver a frictionless service experience without compromising data security.

The past year was a challenging and transformative time for many people as a global, once-in-a-generation health crisis upended critical components of how we work, play and connect.

From remote workers to Netflix bingers, a critical commonality among people was the rapid adoption of digital platforms. Millions of people are now embracing a digital-first approach to life and leisure. IDology’s “Eighth Annual Fraud Report” shows that one-third of organizations experienced a more than 50% shift to digital channels since the pandemic began. Predictably, customer support needs and contact center activities related to these new services are also soaring.

As a Deloitte adviser serving contact centers told The Wall Street Journal, “The increase in call volume was unprecedented across industries, with some experiencing exponential growth almost overnight.”

Further complicating the high volume of calls is the notion that consumers hold businesses to high standards for transactions that are easy and secure. The desire to offer a low-effort, simple experience while also deterring fraud has made identity verification the number one challenge businesses face in addressing fraud, according to the report. To overcome this challenge, contact center leaders need to understand the scope and drivers behind fraud to determine best practices for a successful year ahead.

Fraud & the Pandemic

In many ways, contact centers were in an impossible scenario when the pandemic hit. Many were forced to move their operations off site, just as call volumes soared. What’s more, companies recognized that their surging popularity could be short-lived if they failed to provide an incredible customer service experience. Understanding that many customers will leave after a bad contact center encounter, companies were incentivized to streamline processes and reduce verification standards to optimize service opportunities.

Always looking to capitalize on a crisis, fraudsters pounced on the general confusion, concern and distraction that permeated the moment. According to a Forrester Research report on contact center fraud during the pandemic, customer expectations and on-the-ground realities coalesced to make fraud more possible, probable and profitable. Forrester found that the vast majority say that fraud is a “very serious” issue in contact centers. According to IDology’s report, contact center identity authentication controls are among the top three areas receiving the most funding among businesses across industries in 2021.

Contact center fraud is especially problematic for digital platforms that have onboarded millions of new customers, many digital novices, who are increasingly unwilling to do business with companies that can’t secure their information. Not only are the financial and regulatory implications of fraud incredibly onerous, but the reputational damage can be catastrophic.

After years of high-profile data breaches and seemingly endless data privacy violations, customer sentiment has firmly swung in favor of data privacy. According to IDology’s 2020 study, “Unmasking the Implications of Trust, Friction and Fraud in the Digital Realm,” consumers are less likely to engage with a business that let fraud slip through. An estimated 56 million Americans reported that knowing a business allowed a fraudulent account to be opened in their name could impact the likelihood of initiating a relationship with that company in the future. This indicates the negative brand connotation and ripple effects from new account fraud. Each instance of fraud can not only lead to financial loss, but also to the loss of a new customer down the road.

At the same time, a lack of trust in the identity verification process has negative downstream consequences on customer engagement and cross-channel selling. When consumers mistrust the identity verification process, it not only leads to abandonment but also to negative downstream impacts on revenue and relationship engagement. The consumer study also showed that 21% would be less likely to purchase additional products/services, and 37% said they would be less likely to keep a payment card on file.

In other words, fighting fraud is a bottom-line customer experience issue that companies can’t afford to ignore.

Challenges for Contact Centers

Contact centers are soft targets, staffed with teams tasked with providing impeccable customer service without compromise. These often competing competencies create vulnerabilities that fraudsters can exploit, and they haven’t missed the moment.

Contact centers are soft targets, staffed with teams tasked with providing impeccable customer service without compromise. These often competing competencies create vulnerabilities that fraudsters can exploit, and they haven’t missed the moment.

Without a doubt, the pandemic has exacerbated challenges for contact centers. Many contact centers have decentralized operations, allowing employees to work remotely to maintain operational continuity during a disruptive time. This increases flexibility but makes employees more vulnerable to fraud schemes that can undermine information integrity.

Many contact centers also continue to use high-friction methods to authenticate customers before allowing them to state the reason for their call. According to Aite Group, contact centers are also often recognized as the delivery channel that is most easily compromised by fraudsters, often leading to cross-channel fraud manifested through account takeover (ATO) fraud.

In total, identity verification is the most significant challenge for call centers, and it has many causes.

For starters, billions of records have been compromised in the past several years as data breaches increase in size, scope and frequency. This information is readily available on the Dark Web and hacker forums, where bad actors can quickly and affordably build personal profiles that can be used to trick contact center employees into granting account access or providing other permissions.

Of course, many people post copious amounts of personal information about themselves online, meaning bad actors can often obtain information for identity theft through people-search sites, social media and other digital platforms.

Bad actors are even willing to capitalize on contact center employees’ kindness, empathy and customer-centered approach. Using fabricated stories of hardship, grief and loss, fraudsters trick unsuspecting call center employees into divulging account information or providing information access.

Unfortunately, 53% of businesses expect fraud attempts to increase in the year ahead, which drives the impetus for leaders to develop effective strategies to address the most prominent efforts to steal customer information.

How to Restore Integrity

The challenges are immense, but that doesn’t mean consumers are willing to give companies a pass. Instead, they expect companies to do more to protect their personal information. Therefore, companies need to optimize their approach to call center data security, allowing agents to provide the best experience possible.

A combination of proactive education and technology can significantly improve call centers’ defensive posture. For leaders looking to provide a frictionless customer experience without compromising data security, here are four priorities that can make a difference in 2021.

1. Verify numbers upon entry

Bad actors can compromise data integrity before they even speak with an agent. Automated systems or interactive voice response (IVR) systems offer account activities that allow fraudsters to make substantial inroads to account takeover.

As mentioned earlier, this has become so pernicious that more than half of all businesses now rank identity verification as their top fraud challenge, underscoring the importance of certifying authenticity in a digital-first, automated environment.

An identity verification solution that can verify the phone number of an IVR when in session with a contact center can help prevent this problem. This technology sifts legitimate calls, ultimately creating a more productive customer experience with less friction.

2. Layer identity verification solutions

When customer contacts appear to be spoofed or knowledge-based authentication questions are answered incorrectly, agents need options for quickly escalating to an additional verification methodology in real-time, such as mobile ID scan or one-time verification hyperlinks.

By layering identify verification solutions, contact centers empower agents to diagnose fraud while providing solution methodologies for genuine customer calls. In many cases, agents are the final defense against fraud, and they need the tools to verify legitimate customers while eradicating bad actors.

3. Adapt to the latest trends

Today’s threat landscape is continually evolving. Mobile fraud reached an all-time high in 2020 as the pandemic amplified the potency of mobile fraud vectors, opening the door for bad actors to use automatic number identification/caller ID spoofing, porting, device cloning and recycling of phone numbers to commit fraud. Specifically, ANI spoofing was reported as prevalent by 40% of companies in 2020, up 9% from the previous year.

Agents on the front lines of service can be vitally important in preventing fraud. All employees should be aware of the latest techniques used by fraudsters and encouraged to be on the lookout for suspicious callers.

4. Develop and implement proper protocols

As an extensive expose on spam calls, published in The New York Times, powerfully revealed that fraudulent calls are often tense, manipulative affairs that can leave unprepared agents vulnerable to data exposure. Unclear or weak protocols make their jobs exponentially more difficult. Contact centers need to equip agents with best practices for identifying potential fraud and defending customer data.

Conclusion

According to a 2021 Harris Poll, 75% of consumers “will not buy a product from a company—no matter how great the products are—if they don’t trust the company to protect their data.”

Simply put, today’s fraud landscape poses risks and opportunities for companies. Those that provide customers with a frictionless experience without compromising data security are poised to thrive.

Christina Luttrell

Christina Luttrell

Christina Luttrell is the Chief Executive Officer for IDology, a GBG company and leader in multilayered identity verification and fraud prevention. In her 10 years at IDology, Luttrell has significantly advanced the company’s technology, forged close relationships with IDology customers and driven the development of technology innovations that help organizations stay ahead of constantly shifting fraud tactics without impacting the customer experience. Luttrell has been recognized as one of the Top 100 influencers in identity by One World Identity.

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