Voice of the Industry

How identity trust helps automate approvals and reduce manual reviews

Wednesday 17 February 2021 07:00 CET | Editor: Anda Kania | Voice of the industry

Rich L. Stuppy from Kount shares how major brands have been able to automate approvals and reduce manual review rates with a global data network and adaptive AI

Global ecommerce volume transactions were forecasted to surpass USD 4 trillion last year, according to 451 Research’s Global Unified Commerce Forecast 2020. To reach that number, some businesses are accepting hundreds and thousands of orders and card-not-present (CNP) transactions. And bad actors know, realistically, that businesses can’t keep up with every transaction, making it easier for fraud to go unchecked. 

Typically, manual reviews or basic fraud prevention tools are a business’s first line of defence against fraud. But human limitations make manual reviews impossible to scale. And unsophisticated fraud prevention that relies too heavily on rules or black-box technology results in false positives. That’s where an advanced identity trust platform can help some of the biggest brands automate approvals, reduce manual reviews and accept more good orders. 

Manual reviews can’t scale with the rise in CNP transactions

CNP transactions shift fraud liabilities to businesses, but relying on manual reviews to prevent fraud is unreliable and puts businesses in a difficult position. Manual reviews slow down order acceptance rates. The longer good customers have to wait for a business to approve their orders, the more likely customers are to shop with the competition. 

Knowing there isn’t time to conduct a manual review on every transaction, businesses may forgo manual reviews altogether. But accepting fraudulent orders leads to lost inventory, disputes, chargebacks and higher fees from payment processors. As businesses think about protecting and scaling ecommerce in 2021, they have to stop relying on manual reviews and start automating approvals. 

Establish identity trust at every point of the customer journey 

For any business, effective fraud prevention with seamless customer experiences requires automating approvals. To automate approvals, businesses need to understand each customer’s digital identity trust level throughout their journey. Identity trust is the level of trust or risk for each identity behind every new account creation, login event or payment.

Kount, for example, combines a global identity trust network that links billions of signal data with adaptive AI that uses supervised and unsupervised machine learning. The platform collects the data to create and build elements of digital identity trust in a particular context. Let’s say a customer is creating a new account. Among other things, Kount can analyse the customer’s email address to determine its age. In this context, an email address with an age of zero can indicate fraud long before the customer attempts to complete a purchase.

From there, Kount helps the business provide the appropriate experience based on the level of trust of a particular event. Establishing a level of trust when someone is interacting with a landing page or logging in can reduce the need for a manual review when that person attempts to check out.  

How Brooks Running used networked data to reduce manual reviews below 2%

As Brooks Running’s ecommerce platform grew, so did fraud activity. Fraudulent websites were stealing credit card information and using the Brooks website to conduct drop-shipping schemes. These schemes brought chargebacks and eventually threatened Brooks’ ability to process cards from key issuers. 

So Brooks put Kount’s Identity Trust Global NetworkTM of billions of global interactions to work. Because Kount helps businesses automate fraud detection through advanced AI, fraud analysts have fewer transactions to review manually. And they can analyse the transactions they choose to manually review much faster. 

As a result, Brooks dropped its manual review rate below 2%. Not only did Kount help Brooks reduce manual reviews and get chargebacks under control, but it opened up the brand to new markets. Where the brand would have previously declined international cards outright, Brooks started accepting these cards and generating hundreds of thousands in new revenue. 

How Fetch Rewards analyses email insights to reduce manual reviews below 2%

Meanwhile, Fetch Rewards — an app that delivers coupon discounts and rewards daily purchases — experienced rapid adoption that led to a spike in new account and referral fraud. Users opened fake accounts to collect valuable gift card offers and large referral bonuses. To combat new account fraud, Fetch turned to manual reviews. But it wasn’t long before Fetch’s fraud team found it was manually reviewing 20% of all orders, which affected team morale, revenue and growth campaigns.

Fetch turned to Kount for help and gained access to accurate, high-volume automation, which quickly freed up time spent previously on manual reviews. With Kount, Fetch could prevent fraud as soon as a new user provided their email address. Combined with Omniscore – Kount’s AI-generated transaction safety rating — Kount’s Email Insights abilities helped Fetch identify and block fraudulent interactions. Fetch achieved an unprecedented order approval rate and dropped their manual review rate below 2%. 

When businesses use an identity trust platform to automate decisions, they’re no longer at the mercy of human limitations. Kount helps brands like Brooks Running and Fetch Rewards improve the customer experience, automate decisions to improve order acceptance rates and generate more revenue. Not to mention, reducing manual reviews lowers operational costs and allows fraud teams to scale. 

About Rich L. Stuppy

For more than a decade, Rich Stuppy has been involved in developing fraud mitigation, compliance and big data strategies. In his role as Chief Customer Experience Officer, Rich is responsible for client success, data analytics and ensuring Kount’s users have the best customer experience. He collaborates directly with customers and works to inform Kount’s product roadmap, identify new and emerging threats and drive innovation for ultimate customer satisfaction.

About Kount

Kount’s Identity Trust Global NetworkTM delivers real-time fraud prevention and account protection. It enables personalised customer experiences for more than 9,000 leading brands and payment providers. Linked by Kount’s award-winning AI, the Identity Trust Global Network analyses signals from 32 billion annual interactions to personalise user experiences across the spectrum of trust — from frictionless experiences to blocking fraud. Quick and accurate identity trust decisions deliver safe payment, account creation and login events while reducing digital fraud, chargebacks, false positives and manual reviews. Schedule a demo. 

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Keywords: Kount, machine learning, manual review, fraud prevention, ecommerce, false positives
Categories: Payments & Commerce
Countries: United States
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