Fraud Protection for eCommerce Evolves to a New Level

Dan Brames
FIS | Head of Retail and Corporate Payments
Posted on August 17, 2017

With the vast majority of U.S. adults regularly shopping online these days, the threat of card-not-present fraud looms large as fraudsters shift their focus from point-of-sale to online transactions.

As an eCommerce player, how do you balance the conflicting constraints of providing your customers with both convenience and payment security? If retailers make the authentication process too onerous, shopping cart abandonment rates soar. If they make the process too simple, their customers are primed for account takeover. Historically, making online transactions convenient for customers has translated to less payment security. But, payment security is table stakes for retaining online customers.

No More Tradeoff Between Convenience and Security

Until now, no central authentication registry for a large network of member companies has existed. Consumers haven’t been able to go to one place, one time, register their identities in an app and use it across multiple locations and channels – i.e., online retailers, other eCommerce sites, and financial institutions. Instead, they’ve had to create numerous passwords, individualized for each site where they shop or they’ve had to fill in all of their information each time they make a purchase as a “guest.” Before consumers open their wallets, they open their lists of passwords. This creates friction in the online purchasing process.

In Maria Schuld’s recent article, The Fight on Fraud Continues to Evolve, she discussed how digital identification uses a combination of data analytics and technologies such as biometrics (e.g., thumbprints) and device profiles to authenticate consumers. Now, consumers can have both convenience and payment security when shopping through online retailers.

During recent focus group sessions, shoppers gave the thumbs up to accessing a network of member eCommerce companies and financial institutions with a single sign on:

I love that there’s no need to remember passwords. And then there is the security that goes with it.
There’s convenience using a thumbprint, but I also think it’s more secure.

What This Means for eCommerce Retailers

Digital identification vastly improves the customer experience and benefits eCommerce companies in multiple ways:

• Boosts revenue by lowering the probability of abandonment due to a laborious authentication process
• Increases efficiency by speeding up transactions
• Provides eCommerce players with a high degree of confidence that customers are who they say they are without putting them through high hurdles

A Better Mousetrap for All Types, Sizes, and Tenures of Secure eCommerce Players

As the network of participating members grows, it strengthens. The technology behind digital identification “learns” participating consumers’ behaviors and patterns over time and alerts members about suspicious activity occurring anywhere within the network of member companies, not just on your eCommerce website.

Although major online retailers serving repeat customers possess a high degree of confidence that these customers are really who they say they are, they cannot maintain the same level of faith with new customers. But, if the new customer is part of the digital identification network, you greatly reduce your risk.

For small eCommerce companies and startups, you get more for less with digital payment identification. It represents a much more cost-effective authentication technology than building it yourself and provides a superior solution.

If your company is interested in additional information about this leading edge tool in the fight against online fraud, you can either speak with a financial institution that has signed up for membership, or visit

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Dan Brames
FIS | Head of Retail and Corporate Payments

Dan brings over 20 years of financial and payments industry experience to FIS through senior marketing and management roles. Most recently, he was a management team member at Valutec which was acquired by Metavante in 2007 and FIS in 2009.