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DBS Bank, one of the largest retail banks in South East Asia, recently announced plans to launch a real-time SMS/text alert service after a $1 million ATM skimming scheme hit over 700 DBS Bank customers in Singapore.
Tom Wills, a fraud analyst for Javelin Strategy & Research, says financial institutions (FIs) in other markets, such as the United States and Europe, can learn from DBS’s example. “Offering SMS alerts to customers for ATM withdrawals is a smart move for any FI, because it takes advantage of the strengthened transaction security that mobile out-of-band messaging offers,” he says.
Phil Blank, who works in Javelin’s Security, Risk and Fraud Practice, agrees mobile technology is vastly underused as a means of communicating transactional information with consumers. He says most institutions, especially in the US, are not keeping up with fraud trends, and they fail to adequately leverage mobile technology for alerts.
“If FIs would encourage consumers to set alerts on their credit and or debit cards, a lot of this would be detected a whole lot sooner,” Blank says. “Skimming is only effective if there is a delay between the time of the skim charge and the time the consumer notices it on their statement. Without alerts, the fraudsters will always have the upper hand.”
Learn more about how mobile fraud alerts can help FIs to reduce fraud losses by downloading the Clairmail white paper, Fraud Solution: Leveraging Mobile to Combat Fraud.
“After several years of technology-driven expectations, mobile banking is finally seeing sustained traction in the United States, and banks have rolled out support broad enough to enable consumers with nearly any mobile device to access basic banking functionality,” said Brad Strothkamp, vice-president, principal analyst, eBusiness and Channel Strategy, Forrester Research. “As consumers gain confidence with the channel, their needs are shifting from simple functionality like account balances and ATM locators to transactions like bill payment and account transfers.”
90 million people in the U.S. owned smartphones during this three month period, which is up 10 percent from the preceding three month period.
Due to heightened government scrutiny on traditional fee income, a poor economy and negative publicity, financial institutions (FIs) face tremendous pressure to fill revenue gaps.
