How LATAM Banks Can Face Down Fraud Amid Booming Digital Business
The Latin American financial services market is one of dynamism and danger. The region boasts a population of 650 million, and its largest economies – Brazil and Mexico – boast GDPs well over a trillion dollars each. McKinsey has identified Latin America as the global growth leader in banking, and that trend was accelerated after the COVID-19 pandemic prompted the creation of tens of millions of new online bank accounts.
But that growth and excitement also carries with it the threat of fraud.
It has been estimated that as much as 20 percent of new accounts created in the region are fraudulent, and the world's highest Card-Not-Present fraud rates are found in Mexico and Brazil. Summarizing findings by the Inter-American Development Bank and the Organization of American States, Fortune Business Insights reports that out of 32 countries that were assessed, half "do not have adequate response capacity in times of fraud incidence," and “more broadly, rapid digitization across the region is spurring growing demand for advanced fraud detection solutions.”
It's clear then that in a booming financial services market, those financial services providers that take the threat of fraud seriously and find ways to address it are likely to outperform the rest, especially as customers become increasingly aware of the risks of fraud and seek out trustworthy institutions with which to do business.
Already, consumers are starting to show a more robust understanding of the need for post-password and PIN security mechanisms, with a recent Experian report indicating that a strong majority (74 percent) prefer biometric authentication as a security method.
Fortunately, there are readily available biometric security solutions that can cover every touchpoint of the customer banking journey – not just online banking through a web portal or mobile app, but at the bank branch and the ATM.
As detailed in HID Global's eBook, Better Banking Experiences Start With Strong Authentication and Face Biometrics, sophisticated biometric technologies, such as face and fingerprints, can be used to verify customers through every channel – frictionlessly and seamlessly. Choosing the right biometric solutions can dramatically improve the customer experience while heightening security.
Biometrics multi-factor authentication (MFA) – including contactless face recognition and one-touch fingerprint authorization – offer a win-win for Latin American banks and their customers as the region's financial services sector continues to progress through explosive growth and digital transformation.
To learn more, be sure to download HID's eBook, Better Banking Experiences Start With Strong Authentication and Face Biometrics today.