A library of snippets
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But there is a risk for banks that customers move away from their own apps or online services, weakening their relationship and thwarting their ability to cross-sell. It could leave banks as the plumbing behind the scenes, used to facilitate the movement of money.
From UK banks prepare to share customer data in radical shake-up
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Thanks to Richard van Arnholt for pointing out to me that
NIST now states that if authentication is used via sms (out-of-band), ‘the verifier SHALL verify that the pre-registered telephone number being used is associated with a specific physical device. […] Verifiers SHOULD consider risk indicators such as device swap, SIM change, number porting, or other abnormal behavior before using the PSTN to deliver an out-of-band authentication secret.’
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Blockchain could become the future of the passport. It is a transparent and tamper-proof ledger, which can be used to verify a person’s identity.
This sounds like typical magical thinking, but if you look at the diagram in their report, what it actually shows is something not entirely crazy. The idea would be to have some form of government shared ledger (let’s call it the UKLegder) that is validated by a number of public bodies.
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Instead, du Toit predicts, banks will partner with Amazon and others. Lenders would manufacture financial products, and tech giants would serve as distribution and servicing channels. In other words, what Amazon already does with consumer goods.
Yet because distribution accounts for two-thirds of banking profits, according to a McKinsey & Co. report, banks may not love being relegated to mere factories for mortgages and credit cards.
And because Amazon wouldn’t have to pay to lure customers — it already has millions of them — it could afford to set up digital accounts without “all the nuisance fees and relatively high minimum balances” that lenders impose
From Consumers Want Tech Firms to Take On the Banks – Bloomberg
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Facebook’s new “proactive detection” artificial intelligence technology will scan all posts for patterns of suicidal thoughts, and when necessary send mental health resources to the user at risk or their friends, or contact local first-responders.
From Facebook rolls out AI to detect suicidal posts before they’re reported | TechCrunch
This is admirable, of course. No-one would say otherwise. But it must be transparently obvious that the same technology could detect all sorts of other patterns as well.
The “meme” that banks are, essentially, a special kind of technology company (special because they are granted special privileges that other companies do not have, such as the ability to create money) is common.
Here’s what Christian Edelmann and Patrick Hunt said in the Harvard Business Review: “Technology specialists will play a greater role in allocating investments, working alongside senior management from a more traditional background”. From my early experiences as an advisors to boards, I can see the dynamics at work here. To pick an obvious topic, some financial organisations’ early response to open banking was to see Application Programming Interfaces (APIs) as something to do with technology and therefore not strategic. This left them on the back as
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Instead, du Toit predicts, banks will partner with Amazon and others. Lenders would manufacture financial products, and tech giants would serve as distribution and servicing channels. In other words, what Amazon already does with consumer goods.
Yet because distribution accounts for two-thirds of banking profits, according to a McKinsey & Co. report, banks may not love being relegated to mere factories for mortgages and credit cards.
From Consumers Want Tech Firms to Take On the Banks – Bloomberg
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And because Amazon wouldn’t have to pay to lure customers — it already has millions of them — it could afford to set up digital accounts without “all the nuisance fees and relatively high minimum balances” that lenders impose
From Consumers Want Tech Firms to Take On the Banks – Bloomberg
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The advancements made in social media analytics empower deciphering social media data to forecast impending life events… The ability to discern such events in advance can certainly help retail banks in targeting customers – current and future, with personalized products and offerings that are most relevant to them.
From Banks need to swipe their ‘social media’ cards to pay up for Person…
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The number of young people caught acting as “money mules” has doubled in the past four years, according to the UK’s fraud prevention service, Cifas
From Number of young people acting as ‘money mules’ doubles – BBC News
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The group in Shaoguan is accused of moving money illegally using 148 bank accounts opened in 20 provinces with stolen identity cards, according to Xinhua.
From China Reports Breaking Up Gang That Moved $3 Billion Abroad – Bloomberg
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Identity fraud is absolutely out of control in the UK and there is, so far as I can see, no prospect of any form of infrastructure coming into place to deal with the problem. Whether we look at scammers going through Facebook to perpetrate dating fraud or going through LinkedIn to perpetrate invoice fraud or going through the Land Registry to perpetrate property fraud or going through Companies House to perpetrate corporate fraud, we can draw only one conclusion: identity is broken. Until we fix identity, we can’t attack fraud. And since it’s going to take a while to fix identity, even if we start now, that means that fraud is going to carry on getting worse. Don’t believe me? Then listen to a bank:
[Barclays] is predicting that online festive fraud will be at its highest ever levels in December 2017 and could cost shoppers more than £1.3bn.
From Barclays warns of unprecedented online fraud this Christmas
Well, here’s wishing you a Happy New Year! The truth is that we are under attack. It isn’t script kiddies and casual card counterfeiters any more, it’s organised crime. The Callcredit Annual Fraud & Risk Report surveyed over a hundred fraud professionals and found that more than three-quarters of them rated organised cybercrime as the biggest fraud threat to their organisations in the coming year. Given that current projections are that the damage from cybercrime will double from $3 trillion last year to $6 trillion in 2021, their fears are well-founded. I don’t need to labour the point: in the long term someone will fix the identity problem but in the short term we will continue to lose vast amounts to identity fraud.
Yet when those same fraud professionals were asked what their priorities were for the coming year, nearly nine in ten put regulatory compliance at the top of their list. At a time when organisations need to invest in defending themselves by using new types of dynamic data in combination with “traditional” identity verification and strong authentication techniques, the spend is going on compliance (which clearly isn’t working – if it was identity fraud wouldn’t be out of control). Surely the ROI on bringing in new and actionable data is such that it deserves a separate line in the budget? After all, the investment should be measured against the fraud in a couple of years’ time not the fraud of a couple of years ago.
Why do I focus on data in this way? The answer is that if there is any light at the end of the tunnel right now, it’s coming from the world of Artificial Intelligence (AI). If we look at what kinds of AI are being deployed in the banking sector and what they are being used for, we see that machine learning tops the list of technologies and fraud detection and prevention tops the list of applications. Companies will be able to use new forms of varied and dynamic data for fraud prevention precisely because it will be AI consuming that data and making effective use of the wider range of inputs. As more accomplished bankers than me have noted, the battleground for banks is data, and this is one of the key reasons why. Without data, you can’t do decent risk management and if you can’t do decent risk management… then why have the bank in the loop?
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