Global Consumers React to Rising Payment Fraud

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ACI and Aite share results of a global study and convey consumer attitudes towards payment fraud, its affect on customer retention, and working with banks in the fight against fraud. http://www.aciworldwide.com

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Global Consumers React to Rising Payment Fraud

  1. 1. Global Consumers React to Rising Fraud: Beware Back of Wallet Confidential ACI Worldwide & Aite Group 14 November 2012
  2. 2. Agenda About the Speakers Research Approach 2012 Research Results •  Global •  The Americas •  EMEA •  Asia Pacific •  Year-to-year Comparisons •  Key Trends •  Recommendations Questions & Answers 14 November 2012 2Confidential
  3. 3. Today’s Speakers 14 November 2012 Confidential 3 Mike Braatz SVP & Product Line Manager Shirley Inscoe Senior Analyst
  4. 4. Research Methodology • Q3 2012 survey of 5,223 consumers (over 300 per country) •  The study was conducted in a total of 17 countries across the following regions: –  The Americas (North and South America): Brazil, Canada, Mexico, and the United States –  EMEA (Europe, the Middle East, and Africa): France, Germany, Italy, the Netherlands, South Africa, Sweden, the United Arab Emirates, and the United Kingdom –  Asia-Pacific: Australia, China, India, Indonesia, and Singapore 14 November 2012 Confidential 4
  5. 5. Research Key Takeaways •  Financial institutions risk losing customers who experience fraud •  Consumers fear identity theft •  Some consumers continue to exhibit risky behaviors which could lead to fraud •  Consumers have a strong desire to partner with financial institutions for fraud prevention 14 November 2012 Confidential 5
  6. 6. 2012 Research Results 14 November 2012 Confidential 6
  7. 7. ©2012  Aite  Group  LLC.    7   Agenda   •  2012  Research  Results   •  Global   •  The  Americas   •  EMEA   •  Asia  Pacific   •  Year-­‐to-­‐year  Comparisons   •  Key  Trends   •  RecommendaEons  
  8. 8. ©2012  Aite  Group  LLC.    8   Global  fraud  rates  by  country   12% 12% 13% 18% 20% 24% 25% 25% 26% 31% 33% 34% 36% 36% 37% 42% 44% Sweden The Netherlands Germany Indonesia France Italy Canada South Africa Singapore Australia Brazil United Kingdom China The U.A.E. India United States Mexico Percentage of Respondents Who Have Experienced Card Fraud (N=5,114) 1 in 4 cardholders (27%) experienced fraud in the past five years. Source: Aite Group, ACI Worldwide study of 5,223 consumers in 17 countries, Q3 2012
  9. 9. ©2012  Aite  Group  LLC.    9   Credit  card  fraud  rates  by  country   37% 37% 33% 31% 30% 30% 27% 27% 23% 22% 20% 19% 18% 14% 11% 10% 8% United States Mexico The U.A.E. United Kingdom Brazil Australia China India Singapore Italy South Africa Canada France Indonesia Sweden Germany The Netherlands Q. Have you experienced fraud on your credit card in the past 5 years? (N=5,114) Source: Aite Group, ACI Worldwide study of 5,223 consumers in 17 countries, Q3 2012
  10. 10. ©2012  Aite  Group  LLC.    10   Debit  card  fraud  rates  by  country   25% 24% 21% 20% 17% 17% 13% 12% 12% 11% 11% 11% 10% 9% 9% 8% 6% Mexico China India United States United Kingdom Brazil Canada France South Africa Singapore The U.A.E. Sweden Italy Australia The Netherlands Indonesia Germany Q. Have you experienced fraud on your debit card in the past 5 years? (N=5,114) Source: Aite Group, ACI Worldwide study of 5,223 consumers in 17 countries, Q3 2012
  11. 11. ©2012  Aite  Group  LLC.   11   Prepaid  card  fraud  rates  by  country   Country  (N=5,114)   Experienced  fraud  during  past  5  years   India   19%   China   16%   Mexico   10%   Italy   9%   Brazil   7%   Singapore   6%   The  U.A.E.   6%   United  States   5%   Indonesia   4%   South  Africa   4%   Germany   3%   Sweden   3%   France   3%   Australia   2%   Canada   2%   United  Kingdom   1%   The  Netherlands   1%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  12. 12. ©2012  Aite  Group  LLC.    12   Agenda   •  2012  Research  Results   •  Global   •  The  Americas   •  EMEA   •  Asia  Pacific   •  Year-­‐to-­‐year  Comparisons   •  Key  Trends   •  RecommendaEons  
  13. 13. ©2012  Aite  Group  LLC.   13   Sa@sfac@on  levels  and  aBri@on   15% 10% 37% 56% 12% 7% 27% 15% United States Canada Mexico Brazil Q. How happy were you with the treatmentfrom your card provider after experiencing fraud, and did you change providers? (n=431) Unhappy with treatment from card provider Changed card providersafter experiencing fraud
  14. 14. ©2012  Aite  Group  LLC.    14   Sa@sfac@on  level  factors  -­‐  the  Americas   Q.  What  is   the  main   factor  that   influenced   how  happy   you  were   with  your   financial   institution?   (n=431)       Speed  with   which  FI   identified   the  fraud   and  brought   it  to  my   attention       Speed  with   which  FI   replaced  my   card       Speed  with   which  FI   reimbursed   my  money         How  easy   it  was  to   notify  my   FI  of  the   issue  and   get   reimbursed       I  was   happy   with  all   aspects  of   treatment   from  my   FI       I  was  not  at   all  happy   with  the   treatment   from  my  FI       Brazil   23%   7%   29%   19%   8%   14%   Canada   43%   14%   10%   10%   20%   3%   Mexico   17%   6%   12%   24%   17%   24%   United   States   37%   9%   14%   12%   26%   2%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012    
  15. 15. ©2012  Aite  Group  LLC.   15   Back  of  wallet  behavior  –  the  Americas   Q.  After  you   experienced   fraud,  did  you  use   cash  or  an   alternate  payment   method  rather   than  your  card?   (n=431)       Yes,  in  all   situations   Yes,  but  only  in   some  situations   Used  cash  instead   of  my  debit  card,   but  not  instead  of   my  credit  card   No   Brazil   15%   42%   4%   39%   Canada   3%   31%   5%   61%   Mexico   12%   56%   3%   29%   United  States   7%   37%   2%   54%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012    
  16. 16. ©2012  Aite  Group  LLC.    16   Replacement  cards  –  the  Americas   Q.  As  a  result  of  the  data  breach  or  fraud,  did  you  use  the   replacement  card  less  than  the  original  card?    (n=277)   Yes   No   Brazil   56%   44%   Canada   24%   76%   Mexico   63%   37%   United  States   33%   67%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012    
  17. 17. ©2012  Aite  Group  LLC.    17   Risky  consumer  behavior  -­‐  Americas   Q.  Which  of  these  actions  have  you  taken  in  the  past  5  years?   (n=1,224)   Brazil   Canada   Mexico   United   States   Made  a  note  of  PIN  and  carried  it  with  me  or  kept  it  with  my   card   16%   4%   9%   7%   Thrown  bank  statements  or  ATM  receipt  in  the  trash   45%   25%   36%   23%   Used  online  banking  or  Internet  shopping  without  security   software  or  on  a  public  computer   22%   6%   20%   13%   Responded  to  emails  or  calls  asking  for  bank  details   8%   3%   7%   6%   Not  used  the  auto  lock  feature  on  my  mobile  phone   21%   11%   17%   18%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  18. 18. ©2012  Aite  Group  LLC.    18   Preferred  contact  method    -­‐  Americas  
  19. 19. ©2012  Aite  Group  LLC.    19   Fraud  educa@on  –  the  Americas   Q.  Has  your  financial  institution  provided  any  guidance  or   tips  for  anti-­‐fraud?  (n=1,224)   Brazil   Canada   Mexico   United   States   Yes,  I've  received  emails  from  them  with  anti-­‐fraud   information   15%   15%   14%   19%   Yes,  I've  received  mail  from  them  with  anti-­‐fraud   information   15%   13%   5%   22%   Yes,  I've  seen  this  on  my  financial  institution's  website   25%   17%   14%   13%   Don't  recall  receiving  any  anti-­‐fraud  information  from  my   financial  institution   42%   52%   65%   43%   Not  applicable   3%   3%   2%   3%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  20. 20. ©2012  Aite  Group  LLC.   20   Agenda   •  2012  Research  Results   •  Global   •  The  Americas   •  EMEA   •  Asia  Pacific   •  Year-­‐to-­‐year  Comparisons   •  Key  Trends   •  RecommendaEons  
  21. 21. ©2012  Aite  Group  LLC.    21   Sa@sfac@on  levels  and  aBri@on   57% 45% 37% 28% 26% 21% 20% 13%15% 27% 26% 13% 9% 10% 12% 9% Italy The U.A.E. Germany S. Africa The Netherlands U.K. France Sweden Q. How happy were you with the treatmentfrom your card provider after experiencing fraud, and did you change providers? (n=519) Were unhappywith treatment from card provider Changed fraud providersafter experiencing fraud
  22. 22. ©2012  Aite  Group  LLC.    22   Sa@sfac@on  level  factors  -­‐  EMEA   Q.  What  is  the   main  factor  that   influenced  how   happy  you  were   with  your   financial   institution?   (n=533)   Speed  with   which  FI   identified  the   fraud  and   brought  it  to   my  attention   Speed  with   which  FI   reimbursed   my  money   Speed  with   which  FI   replaced   my  card   How  easy  it   was  to  notify   my  FI  of  the   issue  and  get   reimbursed   I  was  happy   with  all   aspects  of   treatment   from  my  FI   I  was  not  at   all  happy   with  the   treatment   from  my  FI   France   32%   18%   13%   17%   13%   7%   Germany   24%   13%   29%   10%   16%   8%   Italy   32%   23%   11%   9%   3%   22%   The  Netherlands   31%t   26%   9%   11%   14%   9%   South  Africa   19%   20%   8%   17%   27%   9%   Sweden   30%   22%   11%   16%   16%   5%   The  U.A.E.   27%   21%   17%   11%   8%   16%   United  Kingdom   37%   30%   9%   10%   13%   1%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  23. 23. ©2012  Aite  Group  LLC.    23   Back  of  wallet  behavior  -­‐  EMEA   Q.  After  you  experienced  fraud,  did  you   use  cash  or  an  alternate  payment  method   rather  than  your  card?  (n=533)   Yes,  in  all   situations   Yes,  in  some   situations   No   Used  cash  instead   of  debit  card,  but   not  credit  card   France   13%   25%   60%   2%   Germany   18%   32%   45%   5%   Italy   15%   35%   44%   6%   The  Netherlands   3%   14%   83%   0%   South  Africa   15%   36%   45%   4%   Sweden   5%   33%   62%.   0%   The  U.A.E.   12%   45%   41%   2%   United  Kingdom   9%   30%   58%   3%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  24. 24. ©2012  Aite  Group  LLC.   Page  24   Replacement  cards  -­‐  EMEA   Q.  As  a  result  of  the  data  breach  or  fraud,  did  you  use  the  replacement   card  less  than  the  original  card?  (n=322)   Yes     No   France   25%   75%   Germany   36%   64%   Italy   34%   66%   The  Netherlands   33%   67%   South  Africa   51%   49%   Sweden   26%   74%   The  U.A.E.   40%   60%   United  Kingdom   38%   62%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  25. 25. ©2012  Aite  Group  LLC.    25   Risky  consumer  behaviors  –  EMEA   Q.  Which  of  the  following  have   you  done  in  the  past  5  years?   (n=2,442)   France   Germany   Italy   The   Nether -­‐lands   South   Africa   Swe-­‐ den   The   U.A.E.   U.K.   Made  a  note  of  PIN  and   carried  it  with  you  or  kept  it   with  your  card   3%   10%   17%   2%   12%   9%   14%   12%    Thrown  bank  statements  or   ATM  receipt  in  the  trash   33%   15%   32%   14%   58%   43%   41%   16%   Used  online  banking  or   Internet  shopping  without   security  software  or  on  a   public  computer   10%   14%   19%   3%   17%   14%   24%   8%   Responded  to  emails  or  calls   asking  for  bank  details   4%   5%   4%   3%   5%   4%   12%   3%   Not  used  the  auto  lock  feature   on  my  mobile  phone.   13%   16%   19%   16%   27%   25%   24%   23%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  26. 26. ©2012  Aite  Group  LLC.   26   Preferred  contact  methods  -­‐  EMEA  
  27. 27. ©2012  Aite  Group  LLC.    27   Fraud  educa@on  -­‐  EMEA   Q.  Has  your  financial   institution  provided  any   guidance  or  tips  for  anti-­‐ fraud?  (n=2,442)   France     Germany   Italy   The   Nether-­‐ lands   South   Africa   Swe-­‐ den   The   U.A.E.   U.K.   Yes,  I've  received  email  from   them  with  anti-­‐fraud   information   11%   11%   14%   17%   43%   6%   47%   18%   Yes,  I've  received  mail  from   them  with  anti-­‐fraud   information   12%   20%   13%   14%   7%   6%   10%   20%   Yes,  I've  seen  this  on  my   financial  institution's   website   19%   19%   16%   30%   30%   40%   19%   21%   Don't  recall  receiving  any   anti-­‐fraud  information  from   my  financial  institution   53%   39%   54%   31%   19%   43%   22%   38%   Not  applicable   5%   11%   3%   8%   1%   5%   2%   3%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  28. 28. ©2012  Aite  Group  LLC.    28   Agenda   •  2012  Research  Results   •  Global   •  The  Americas   •  EMEA   •  Asia  Pacific   •  Year-­‐to-­‐year  Comparisons   •  Key  Trends   •  RecommendaEons  
  29. 29. ©2012  Aite  Group  LLC.    29   Sa@sfac@on  levels  and  aBri@on   63% 60% 55% 50% 14% 45% 41% 40% 45% 3% Indonesia India Singapore China Australia Q. How happy were you with the treatmentfrom your card provider after experiencing fraud, and did you change providers? (n=445) Unhappy with treatment from card provider Changed card providersafter experiencing fraud
  30. 30. ©2012  Aite  Group  LLC.    30   Sa@sfac@on  level  factors  -­‐  APAC   Q.  What  is   the  main   factor  that   influenced   how  happy   you  were   with  your   financial   institution?   (n=445)   Speed  with   which  FI   identified   the  fraud   and  brought   it  to  my   attention   Speed   with   which  FI   replaced   my  card   Speed  with   which  FI   reimbursed   my  money   How  easy  it   was  to  notify   my  FI  of  the   issue  and  get   reimbursed   I  was  happy   with  all   aspects  of   treatment   from  my  FI   I  was  not   at  all   happy   with  the   treatment   from  my  FI   Australia   29%   19%   9%   15%   25%   3%   China   25%   17%   12%   27%   8%   11%   India   31%   19%   26%   3%   8%   13%   Indonesia   34%   12%   12%   26%   14%   2%   Singapore   29%   35%   8%   9%   9%   10%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  31. 31. ©2012  Aite  Group  LLC.    31   Back  of  wallet  behavior  -­‐  APAC   Q.  After  you  experienced  fraud,  did  you  use   cash  or  an  alternate  payment  method  rather   than  your  card?  (n=445)   Yes,  in  all   situations   Yes,  in  some   situations   No   Used  cash   instead  of  debit   card,  but  not   credit  card   Australia   6%   34%   58%   2%   China   16%   50%   27%   7%   India   25%   52%   17%   6%   Indonesia   12%   68%   14%   6%   Singapore   8%   45%   45%   2%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  32. 32. ©2012  Aite  Group  LLC.    32   Replacement  cards  -­‐  APAC   Q.  As  a  result  of  the  data  breach  or  fraud,  did  you  use  the   replacement  card  less  than  the  original  card?  (n=259)   Yes     No   Australia   37%   63%   China   73%   27%   India   73%   27%   Indonesia   78%   22%   Singapore   51%   49%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  33. 33. ©2012  Aite  Group  LLC.    33   Risky  consumer  behaviors  -­‐  APAC   Q.  Which  of  the  following  have  you  done  in  the   past  5  years?  (n=1,557)   Australia   China   India   Indonesia   Singapore   Made  a  note  of  PIN  and  carried  it  with  me  or   kept  it  with  my  card   6%   21%   26%   17%   11%   Thrown  bank  statements  or  ATM  receipt  in  the   trash   28%   51%   45%   39%   50%   Used  online  banking  or  Internet  shopping   without  security  software  or  on  a  public   computer   10%   30%   32%   20%   22%   Responded  to  emails  or  calls  asking  for  bank   details   4%   13%   23%   16%   13%   Not  used  the  auto  lock  feature  on  my  mobile   phone   19%   26%   24%   23%   23%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  34. 34. ©2012  Aite  Group  LLC.    34   Preferred  contact  method  -­‐  APAC  
  35. 35. ©2012  Aite  Group  LLC.   Page  35   Fraud  educa@on  -­‐  APAC   Q.  Has  your  financial  institution  provided  any   guidance  or  tips  for  anti-­‐fraud?  (n=1,557)   Australia   China   India   Indonesia   Singapore   Yes,  via  email   14%   17%   51%   22%   23%   Yes,  via  mail   29%   10%   11%   16%   18%   Yes,  via  their  website   17%   26%   13%   19%   16%   Don't  recall  receiving  any  anti-­‐fraud   information  from  my  financial  institution.   39%   39%   18%   36%   38%   Not  applicable   1%   8%   7%   7%   5%   Source:  Aite  Group,  ACI  Worldwide  study  of  5,223  consumers  in  17  countries,  Q3  2012  
  36. 36. ©2012  Aite  Group  LLC.   36   Agenda   •  2012  Research  Results   •  Global   •  The  Americas   •  EMEA   •  Asia  Pacific   •  Year-­‐to-­‐year  Comparisons   •  Key  Trends   •  RecommendaEons  
  37. 37. ©2012  Aite  Group  LLC.    37   Mul@ple  incidents  of  card  fraud  globally   The increase in the percentage of cardholders who experienced fraud more than one time is statistically significant. Source: Aite Group, ACI Worldwide study of 5,223 consumers in 17 countries, Q3 2012
  38. 38. ©2012  Aite  Group  LLC.    38   Confidence  in  FIs  –  the  Americas   2% 1% 10% 7% 68% 61% 20% 31% 2% 0% 9% 6% 60% 51% 29% 43% 4% 1% 25% 23% 56% 55% 15% 21% 2011: No 2012: No 2011: Not really 2012: Not really 2011: Yes, to an extent 2012: Yes, to an extent 2011: Yes, absolutely 2012: Yes, absolutely Q. Do you have confidence in your financial institutionto protectyou from card fraud? (2012, n=302; 2011, n=900) Brazil Canada United States
  39. 39. ©2012  Aite  Group  LLC.   39   Confidence  in  FIs-­‐  EMEA   2% 2% 11% 8% 74% 74% 13% 16% 3% 12% 22% 20% 61% 50% 14% 18% 4% 8% 16% 14% 52% 54% 28% 24% 3% 3% 14% 14% 63% 57% 20% 26% 1% 10% 14% 17% 65% 56% 20% 17% 4% 3% 16% 5% 66% 71% 14% 21% 2% 2% 15% 12% 63% 57% 20% 29% 2011: No 2012: No 2011: Not really 2012: Not really 2011: Yes, to an extent 2012: Yes, to an extent 2011: Yes, absolutely 2012: Yes, absolutely Q. Do you have confidence in your financial institutionto protectyou from card fraud? (2012, n=458; 2011, n=2,100) France Germany Italy The Netherlands Sweden The U.A.E. United Kingdom
  40. 40. ©2012  Aite  Group  LLC.    40   Confidence  in  FIs  –  Asia  Pacific   2% 0% 18% 17% 63% 66% 17% 17% 3% 0% 15% 5% 54% 62% 28% 33% 3% 3% 39% 37% 45% 51% 13% 9% 2% 3% 12% 10% 73% 65% 13% 22% 2011: No 2012: No 2011: Not really 2012: Not really 2011: Yes, to an extent 2012: Yes, to an extent 2011: Yes, absolutely 2012: Yes, absolutely Q. Do you have confidence in your financial institutionto protectyou from card fraud? (2012, n=395; 2011, n=1,200) Australia China India Singapore
  41. 41. ©2012  Aite  Group  LLC.   41   Addi@onal  comparisons  to  prior  year…   •  Fear  from  iden@ty  theO  is  increasing  –  26%  of  2011  respondents   stated  that  their  biggest  fear  related  to  fraud  was  reclaiming  their   financial  idenEty  if  they  became  vicEms  of  idenEty  theT;  in  2012,  49%   of  respondents  state  they  are  “very  concerned”  about  this  issue   •  Iden@ty  fraud  was  the  top  worry  in  2012  followed  by  online  banking   fraud  and  card  fraud  –  idenEty  fraud  did  not  appear  in  the  top  2  in   2011   •  35%  throw  documents  containing  sensiEve  informaEon  into  trash   bins  and  16%  use  public  computers  or  computers  without  security   soTware   •  No  improvements  in  risky  behavior:   •  12%  indicated  making  a  note  of  their  PIN  and  carrying  it  with  them  or  with   their  card  in  2012  maintaining  the  same  12%  rate  who  did  so  in  2011     •  16%  shopped  on  the  Internet  or  used  online  banking  without  security   soTware  or  on  a  public  computer  in  2012  ,  the  same  rate  in  2011    
  42. 42. ©2012  Aite  Group  LLC.   42   Agenda   •  2012  Research  Results   •  Global   •  The  Americas   •  EMEA   •  Asia  Pacific   •  Year-­‐to-­‐year  Comparisons   •  Key  Trends   •  RecommendaEons  
  43. 43. ©2012  Aite  Group  LLC.    43   Research  key  takeaways   •  Financial  insEtuEons  risk  losing  customers  who   experience  fraud   •  Consumers  fear  idenEty  theT   •  Some  consumers  conEnue  to  exhibit  risky   behaviors  which  could  lead  to  fraud     •  Consumers  have  a  strong  desire  to  partner  with   financial  insEtuEons  for  fraud  prevenEon  
  44. 44. ©2012  Aite  Group  LLC.   44   Financial  ins@tu@ons  risk  losing  customers   due  to  fraud     •  ABri@on  rates  aTer  experiencing  card  fraud  averaged  21%         •  Of  card  holders  who  received  replacement  cards  as  a  result  of  a  data   breach  or  fraudulent  acEvity,  46%  used  the  new  card  less  than  the  original   •  56%  of  card  holders  used  cash  or  an  alternate  form  of  payment  instead  of   a  debit  or  credit  card  aOer  experiencing  card  fraud   •  Only  25%  think  that  government  or  law  agencies  do  the  best  job  of   protecEng  card(s)  or  account  informaEon  from  fraud,  compared  with  43%   who  acribute  that  strength  to  large/mulEnaEonal  financial  ins@tu@ons  
  45. 45. ©2012  Aite  Group  LLC.    45   Consumers  want  to  partner  with  banks  for   fraud  preven@on   •  82%  of  respondents  are  “very  interested”  in  being  noEfied  prior  to  the  bank   taking  acEon     •  74%  of  cardholders  prefer  that  no  addi@onal  transac@ons  be  posted  unEl   they  respond  to  any  noEficaEons  of  a  fraud  alert  from  their  financial   insEtuEon.   •  Mobile  phone  and  text  message  lead  way  for  aler@ng  consumers  as  direct   contact  methods  –  a  change  from  2011  where  home  phone  was  the  second   most  preferred  method   •  Asia  Pacific  lead  the  way  with  mobile  and  text  message   •  EMEA  countries  prefer  call  to  mobile  phone  (except  Netherlands  who  want  call  to   home)   •  Mexico  and  Brazil  prefer  mobile  and  text  message     •  US  prefers  e-­‐mail  and  Canada  prefers  call  to  home  
  46. 46. ©2012  Aite  Group  LLC.   Page  46   Agenda   •  2012  Research  Results   •  Global   •  The  Americas   •  EMEA   •  Asia  Pacific   •  Year-­‐to-­‐year  Comparisons   •  Key  Trends   •  Recommenda@ons  
  47. 47. ©2012  Aite  Group  LLC.   47   Recommenda@ons  for  financial  ins@tu@ons   •  Provide  fast,  easy  recovery  processes.  Simplify  and  make  fraud   resoluEon  process  simple  and  easy    -­‐  it  may  curtail  fraud-­‐related   acriEon.     •  Share  your  fraud  policy.  Make  consumers  aware  of  how  you  work   with  them  aTer  a  fraud  incident  -­‐  consumers  care  about  fraud   resoluEon.     •  Reassure  your  customers.  InsElling  confidence  in  your  process  will   minimize  risk  of  non-­‐use  of  replacement  cards  or  using  cash   alternaEves.       •  Educate  consumers  about  fraud.  The  messages  are  sEll  not  being   heard.  In  most  countries,  a  large  %  of  consumers  do  not  recall  ever   having  their  insEtuEon  providing  informaEon  related  to  fraud.        
  48. 48. ©2012  Aite  Group  LLC.    48   Recommenda@ons  for  financial  ins@tu@ons   •  Telephone  and  text.  By  a  large  majority,  customers  indicate  they   prefer  to  be  contacted  about  a  fraud  alert  via  their  mobile  phone  by  a   call  or  text  message  or  via  their  home  phone.   •  Regularly  update  customer  data.  InsEtuEons  should  update  their   records  of  consumers’  email  addresses  and  mobile  numbers  to   facilitate  communicaEon.  A  simple  process  will  encourage  customers   to  parEcipate.   •  Enlist  consumers  in  comba@ng  fraud.  There  is  a  willingness  for  acEve   parEcipaEon  when  fraud  is  detected  .  Engage  them  in  the  fight.     •  Proac@vely  prevent  fraud.  Consumers  know  fraud  schemes  are   pervasive.  Customer  saEsfacEon  rates  with  FI’s  are  highest  when  the   company  detects  fraud  and  noEfies  the  consumer  of  it.    
  49. 49. ©2012  Aite  Group  LLC.    49   Aite  Group:  Partner,  Advisor,  Catalyst    Aite  Group  (pronounced  eye-­‐tay)  is  an  independent  research  and   advisory  firm  focused  on  business,  technology  and  regulatory  issues   and  their  impact  on  the  financial  services  industry.        Shirley  W.  Inscoe   Senior  Analyst   sinscoe@aitegroup.com   +1.704.987.5087   www.aitegroup.com      
  50. 50. Questions 14 November 2012 Confidential 50
  51. 51. More Information For information on ACI’s payment fraud solutions or to download a copy of the Global Consumers React to Rising Fraud report, visit http://www.aciworldwide.com/annual- fraud-survey Thank you! 14 November 2012 51Confidential
  52. 52. T: + 1 (781) 370-3637 E: michael.braatz@aciworldwide.com www.aciworldwide.com Our software underpins electronic payments throughout retail and wholesale banking, and commerce, all the time, without fail.

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