Companies across Asia Pacific are deprioritising security and fraud prevention, as nearly one-third favour an emphasis on revenue generation. This can increase the risk of an already vulnerable digital ecosystem for consumers across the region, Experian’s new “Global Identity and Fraud Report said. Despite growing fraud risk, there was a 16 percentage point decline in business intention to increase fraud management budgets from June last year to January this year, with 53% expecting to do so in the next six months.
Nonetheless, Experian’s report noted that India (59%) and Australia (57%) are most likely to increase fraud management budgets, followed by Singapore (52%) and Japan (46%). The results show that companies may not realise the same data and tools utilised to improve security and fraud detection also enhance the customer experience if implemented properly.
Meanwhile, consumers in Asia Pacific are prioritising a safe and secure online environment, with 56% indicating that security is the most important dimension when it comes to an online experience. Additionally, three out of five Asia Pacific consumers expect that businesses should provide increased levels of security and data protection when going online. This concern comes as 46% of consumers from Singapore, Japan, India and Australia expect to increase their spending on items purchased online in the next three to six months.
The report also highlighted a mismatch between fraud detection and prevention methods adopted by businesses and consumer preferences. While companies surveyed are still investing in traditional methods to mitigate fraud, such as security questions and passwords, Asia Pacific consumers prefer invisible means of security. In fact, Experian found that 72% of consumers feel the most secure while using physical biometrics or having a PIN code sent to their mobile device. This shows a shift in consumer behaviour that moves away from outdated security measures, indicating that businesses should take a new approach to security, layering visible and invisible methods.
Changing consumer expectations surrounding security will impact businesses across all aspects of the customer journey. More than two-thirds of Asia Pacific consumers will abandon a transaction if they have to wait for more than 30 seconds, for example. According to Experian, this shows the need for fast and seamless fraud checks and authentication to improve loyalty and trust.
Experian’s Asia Pacific CEO Ben Elliott explained that while it is understandable for businesses to focus on revenue generation, digitisation and creating a better digital customer experience, the rise in digitisation means greater risk for businesses.
“Without a focus on fraud protection, they wil be prone to losses in the long-term,” he said. He added that while creating a great online consumer experience is important, enterprises which put all their money into the digital experience at the expense of fraud prevention will be targeted by fraudsters, who have sophisticated ways of identifying weaker online platforms and targeting them.
“Businesses need to strike a balance between ensuring a top-notch digital experience and keeping their fraud prevention programme up to speed
The report surveyed more than 9,000 customers and 2,700 businesses during three waves throughout the pandemic across 10 countries spanning Asia Pacific, North America, Latin America and Europe. This includes the 3,000 consumers and 900 business executives across Singapore, India, Japan, and Australia.
Photo courtesy: 123RF
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