Winning against fraud in the Telecommunications, Pay TV and Utility industries requires striking a balance between optimal customer experiences and mitigating losses. Achieving this balance can be possible when these five steps are combined: tools, data and analytics, customer data, exchanges, and system flexibility. Let’s review more in-depth how these steps work together to help manage fraud more effectively.
#1 Frictionless tools – such as scores, models and rules – work in the background to help detect suspicious identities when customers are applying for services, such as phone, TV or electricity. These tools avoid making the customer experience more complicated resulting in reduced abandonment rates and manual review costs.
#2 Data and analytics make a big difference in fighting fraud. By leveraging proprietary data sources and using predictive modeling and analytics, you can better discern unusual behavior patterns to help identify fraudulent applications and accounts. Again, this is all done without making the customer experience more frustrating.
#3 Incorporating your own customer data to verify identity elements against past identity history can also yield good results. Research with customer data shows that matching rules capture about 55% of fraud overall. This is significantly more than both the 20% captured when the rule isolates high-risk variables and the 25% caught by rules highlighting lack of consistency within an application.1
#4 Learning from data exchanges and consortiums of similar companies can also improve fraud detection. Member companies gain access to shared data enabling them to recognize fraud patterns and tactics earlier and adapt rules to stay ahead of new techniques. In addition, shared data can isolate fraudulent identities that are “in play” across industries before fraud occurs. The National Consumer Telecom & Utilities Exchange®(NCTUE®) is a consortium of over 95 member companies from the telecommunications, utilities, home security and pay TV industries.
#5 Embracing system flexibility is the final step in detecting and deterring fraud. The ability to update your fraud strategies immediately to adapt to changing fraud trends is one of the keys to effective fraud prevention. The best technology allows you to gain control over building, testing, and implementing rules so you can identify fraud patterns earlier and control false positives. This also allows you to integrate fraud detection measures into your decisioning process in real time.
Incorporating these five steps won’t make fraud disappear, but it will make managing it more effective and efficient; all while streamlining the customer experience.
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