Fighting fraud with SMS texts
Financial institutions worldwide are winning the fight against fraud and identity theft with the creative use of SMS text messaging. By sending SMS notifications to customers in real time when their bank account registers activity, the opportunity for fraud is dramatically reduced. By also using SMS text messages to send secondary or log-in PIN codes, identity theft is being done away with.
The deployment of mobile services in the financial services sector (banks, credit unions, credit and debit card issuers, payment processors, money transfer organizations etc) has been slow in the US. The recent Javelin report shows that the number of people who have suffered from identity theft has increased 22% in 2008 from the previous year – more than 9 million people in the USA were affected last year. Customers who have lost money due to financial fraud are five times more likely to change banks because of security concerns. This is according to Gartner research looking at the financial fraud figures of 2008. No financial institution can afford to lose customers because of these factors and SMS text messaging has become an obvious solution to many banks and payment processors who are fighting fraud and identity theft.
The mobile phone is the most effective form to combat fraud and identity theft; it is a personal communication device, it is nearly always on and within reach of the owner. By involving customers in the security process, there is far less chance of them being caught unawares by fraudsters. This involvement extends to SMS Receipts, debit and credit text notifications and account activity text alerts. The customer is able to immediately contact the bank if something does not look right with their transactions and they can verify legitimate uses of their account. By providing an ‘early warning SMS service’ customers have peace of mind and financial institutions dramatically reduce their risk and exposure to fraud.
Some of the world’s most popular financial institutions are using SMS receipts to fight fraud. Moneybookers, the provider of the fast growing e-Wallet service which is available on Facebook and eBay, uses real-time SMS alerts to make Moneybookers a secure online payment option. Giving customers peace of mind about their financial transactions has to be the number one priority in a world populated with ever more sophisticated fraudsters. SMS text messaging is being used in a wide variety of banking applications from mobile banking transactions – account queries, statements, transfers to mobile payments.
SMS text messaging overcomes all handset limitations reaching those in areas that have limited data connectivity or lack WAP-enabled handsets. With more than three billion people using mobile phones everyday for business and personal uses, text messaging is an obvious way to reach financial customers. Some would say that more people would go back to retrieve their mobile phone than their wallet!
Not only can SMS text messaging play a role in combating fraud and identity theft for financial institutions it is also an excellent customer retention and acquisition tool. Text messaging can reduce costs in call centers, be used in customer campaigns and is an effective and affordable way to communicate directly with your customers no matter where they are in the world. Mobile banking is the future.
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Tags: Clickatell, financial institutions, mobile banking, Mobile Financial Services Solutions, mobile payments, notification alerts, SMS, SMS banking, SMS fraud alerts, SMS gateway, SMS notifications, SMS receipts, text messaging, United States
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