Findings from Veriff’s Fraud Index 2024 suggest that consumer acceptance of new security technologies is growing, with some groups still to be convinced.
According to the FTC, fraud topped $10 billion in 2023, a 14% jump in one year. Almost half of consumers, 47.8%, experienced some form of online fraud, a 20% surge from 2022. Unsurprisingly, more than 75% consider a company’s fraud-fighting reputation before signing up.
While much of the fintech talk is about eliminating friction, most folks, 64%, are willing to accept some of it if they believe it keeps their data safer. In financial services, 73.3% said it was important for companies to have security measures, such as ID and selfie verification.
While many are still comfortable with passwords, stolen password credentials were responsible for 61% of company data breaches in 2022, according to Verizon’s 2022 Data Breach Investigations Report.
More consumers are gravitating to newer security methods, with 38.5% viewing facial recognition and biometrics as the most secure online login method. That is, more than one-time codes and passwords are combined. More than half, 60.5%, were comfortable using facial recognition to access online accounts, while 51.6% used selfies and IDs to confirm identities.
“If you want to win new customers, you must secure your service against fraud,” said Ira Bondar, Veriff’s senior fraud group manager.
Nearly 25% (22.6%) were neither uncomfortable nor comfortable using an identity document and selfie when registering for an online service. Veriff believes that suggests room for growth.
“A large number of consumers are happy to adopt IDV tools to protect their online security,” Bondar explained. “Perhaps more importantly, it seems that many users are open to trying such tools in future.”
Opportunity also exists to convince more people to use facial recognition when accessing online accounts; 20.2% were ambivalent, more than the 19.3% who said they were uncomfortable. That comfort level grows in younger cohorts, as 73.2% of those aged 25-34 are fine with it, compared to 49.7% of those 55 or older.
While many are comfortable with facial and fingerprint technology, that doesn’t mean they are using it. More than half, 55%, do, while 41.2% do not. More than three in four, 77%, of 16-24-year-olds use it. That drops to 53.3% of 45-54s and 38.9% of those 55-plus
For example, while almost 77% of 16–24-year-olds currently use the technology, it is only deployed by 53.26% of those in the 45-54 bracket and 38.86% of those aged 55 or above.
“Providers must combine robust security with accessibility and convenience to make the most of the opportunity,” Bondar said.
