More than half (56%) of Australian businesses experienced known or suspected fraud attempts in the last 12 months, according to new research from global digital identity expert, GBG, with almost two-thirds (62%) concerned by the resulting financial impact, brand reputation (48%) and customer retention (45%).
The Global State of Digital Identity 2023 report found four in 10 (40%) Australian businesses said they noticed an increase of identity takeover over the last 12 months and 15% consider identity takeover to pose the biggest fraud risk to their business over the next three years. Identity takeover is a fast-growing technique in which a fraudster combines real (usually stolen) identity information with fake information to create a new identity to illicitly obtain goods and services by posing as genuine customers.
GBG regional general manager for Australia and New Zealand, Carol Chris said, “Increasingly customers are looking for evidence that their identities are protected and that measures are being taken to prevent fraud. Customers are increasingly favouring security over speed when they open new accounts and there is much that business leaders can do to build trust and make use of robust identity verification solutions to protect themselves and their businesses – turning it into a competitive advantage.”
Australian firms are eager to demonstrate how they are protecting their business and their customers. With nearly three-quarters (72%) of businesses considering identity and fraud to go hand in hand, the vast majority are taking a range of measures such as using identity data (76%) and fraud data (72%) during customer onboarding.
Australian businesses are actively engaging technology to manage identity verification with 78% of firms believing good identity verification can be a strategic differentiator, 67% of Australian businesses are set to increase budgets in this area.
Top solutions used by Australian businesses include address verification (58%), identity document verification (55%) and fraud checks (55%). Most Australian businesses (63%) check customer identity in a bid to reduce fraud, while 57% do so to be compliant with regulations.
More than half (54%) of Australian businesses struggle to assess the reliability of different datasets and more than seven in 10 (71%) are considering consolidating identity verification suppliers. Businesses are also looking at adopting future-facing technologies over the next three years to address identity verification including artificial intelligence and machine learning (37%), use of mobile device attributes for verification (33%) and digital identities (32%).