Minimizing Fraud Risk in Buy Now, Pay Later Services
Ma-Keba Frye | July 20, 2021
Buy now, pay later services have seen a significant amount of growth in recent years. Some of the most popular buy now, pay later apps have experienced a 46 percent growth in app installations year-over-year. While this option creates more buying power for consumers, it has caused some concern. In the wake of the pandemic, increased reliance on digital banking and e-commerce has led to a rise in fraud and identity theft cases.
Popular buy now, pay later apps have experienced a 46% growth in app installations year-over-year.
To protect consumer identities and credit, buy now, pay later services need secure and reliable identity verification methods that can help reduce fraud risk. That’s where alternative data comes in. Consumer-permissioned data, including utility and telco payments, isn’t just a valuable resource for credit risk decisioning in the buy now, pay later industry; it can also support identity verification for the industry.
Fraud concerns in buy now, pay later services
The buy now, pay later payment method simplifies the credit process, especially compared to traditional credit cards and loans. With this simplification comes the perfect playground for fraudsters. Buy now, pay later services offer instant credit decisions. While this is convenient, it also makes the payment method an easy target for fraudsters to use stolen, synthetic, and fake identities to establish accounts. Like any other financial services account, account takeover attempts are also a possibility.
Strengthen consumer identity verification
A significant appeal of buy now, pay later services is the easy application and approval process. This creates a new challenge for the identity verification process and customer experience. A seamless and frictionless identity verification solution can bring better security to the industry without compromising the customer experience. By leveraging consumer-permissioned data, buy now, pay later, providers can continue to easily qualify consumers while also reducing potential losses related to account takeovers and identity theft.
A seamless and frictionless identity verification solution can bring better security to the industry without compromising the customer experience.
Improve buy now, pay later services with consumer-permissioned data
Utility and telco account data can provide direct and accurate information to mitigate fraud risk. Urjanet’s Utility Data for Identity Verification solution supports adequate fraud protection, allowing buy now, pay later services to continue seamless approval of valid consumers.
If you’re ready to improve your buy now, pay later offering’s onboarding process, speak with one of our experts today to learn more.
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About Ma-Keba Frye
Ma-Keba Frye is a Content Marketing Associate at Urjanet, assisting with content development and execution. When she's not writing, she enjoys reading, listening to music, and volunteering.