Fraudulent Activities in Africa: How Banks Can Stay Ahead of the Game
As account takeover fraud continues to plague the African banking industry, financial institutions are turning to technology to stay one step ahead of scammers.
The Growing Concern of Account Takeover Fraud
In recent years, facial recognition has become a popular biometric method worldwide. However, some individuals have attempted to manipulate these features by registering multiple times under different names or attempting to use artificial sources like photos.
The Role of Liveness Checks
Liveliness checks involve capturing a short video or a quick succession of frames and audio while the user is in motion. Specialized algorithms then generate a confidence score to determine whether the biometric traits come from a real person. Smile ID, a pioneer in face recognition and liveness solutions since 2016, uses patented SmartSelfie technology that combines six AI models with daily human reviews labeling thousands of images. This ensures that the algorithm is continually strengthened over time.
Behavioral Analysis: A Key Component
In addition to liveliness checks, behavioral analysis plays a crucial role in detecting suspicious activity. Machine learning algorithms scrutinize user behavior and identify anomalies, such as sudden changes in login locations or unusual account activity. Network analysis also involves monitoring network traffic to detect potential fraud. By analyzing login attempts, banks can identify potential takeover attempts and take preventative action.
Preventing Account Takeover Fraud
To prevent account takeover fraud, African banks can implement the following strategies:
- Multi-factor authentication (MFA) with biometrics
- Monitoring for suspicious activity
- Customer education on fraud prevention
- Strong password policies
- Fraud detection software
African Banks Embracing Technology
Several African banks are already using technology to prevent account takeover fraud. Standard Bank South Africa, for instance, implemented a multi-factor authentication system requiring customers to provide passwords, one-time PINs, and fingerprint scans. Ecobank Nigeria uses biometric authentication, including fingerprint scanning, while Absa Group Limited employs FICO Falcon Fraud Manager’s machine learning algorithms to analyze customer behavior in real-time. First National Bank (FNB) South Africa also utilizes a fraud detection system called Manila that analyzes customer behavior patterns.
Conclusion
Account takeover fraud poses a significant threat to African banks and their customers. However, by implementing robust authentication methods and leveraging technological tools like Smile ID, financial institutions can prevent fraud and safeguard customer accounts. As the banking industry continues to evolve, it is essential for banks to educate their customers about the risks of account takeover fraud and collaborate closely with law enforcement agencies to track down and prosecute fraudsters.
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Book a free demo today to see how Smile ID can help your bank stay ahead of the game in preventing account takeover fraud.