As eCommerce continues to lure shoppers away from physical outlets and force long-standing retailers to shut their doors, it’s hard to believe that we ever lived in a world without the digital conveniences we have since grown so accustomed to.

eCommerce has not only altered consumer shopping habits, but it has also raised expectations to include streamlined customer service, fast shipping, and prompt payment processing.

Leveling the Playing Field

The “1-click” patent has finally expired, sending eCommerce companies clamoring to implement similar methods that allow consumers to purchase items with just one click. Having a one-click feature not only translates to convenience for consumers, but also improved conversion rates for businesses by reducing shopping cart abandonment and increasing mobile orders.

Seventeen years ago, “1-click” payments began transforming the eCommerce landscape by replicating the quick credit card swipe of an in-store purchase and combining it with the convenience of online shopping. Since the patent has expired, businesses are no longer required to pay licensing fees to use the technology, and many will aim to create their own streamlined one-click process. However, although the technology to implement a one-click ordering process is relatively basic and therefore a quick fix to alleviate friction, businesses may easily overlook the fact that their success with one-click payments hinges considerably on the effectiveness of their risk management platform.

One-click Payment, One-click Fraud

As numerous data breaches continue to supply the dark web with limitless identity credentials, companies are faced with the challenging task of how to differentiate legitimate customers from fraudsters. Static identity assessment methods alone have been rendered useless as demonstrated by sophisticated cybercriminals who continue to avoid traditional security defenses by mimicking trusted user behavior. And, multi-factor authentication (MFA) methods defeat the primary purpose of one-click payments, which is to create a convenient, streamlined, friction-free customer experience.

Businesses continue to be under constant attack from cybercriminals and their ever-evolving tactics. Having a layered, holistic approach to fraud detection is more critical than ever as fraudsters attempt to monetize stolen identity credentials through account takeover, new accounts, and payments.

eCommerce has not only altered consumer shopping habits, but it has also raised expectations to include streamlined customer service, fast shipping, and prompt payment processing.

Furthermore, consumers transact across a range of devices, storing more personal information online than ever before. Fraudsters are cashing in on this diverse landscape, capitalizing on new techniques for stealing credit card and identity information, and the availability of ever-more sophisticated malware. As mobile transactions continue to increase and we shift to a one-click world, businesses need to strike a delicate balance between fraud and friction. Although payment fraud can be debilitating for a business, insulting legitimate customers with inaccurate authentication or unnecessary friction can also have hefty ramifications for revenue, customer lifetime value, and reputation.

Leveraging the Largest Repository of Digital Identity Intelligence

Knowing who your customers really are and how and when they transact, can detect suspicious behavior or compromised devices before accounts are infiltrated by cybercriminals. Built from crowdsourced intelligence from approximately 24 billion global transactions each year including logins, payments, and new account applications, ThreatMetrix Digital Identity Network provides a wealth of cross-industry intelligence related to devices, locations, identities and past behaviors.

Using this information, ThreatMetrix helps businesses understand the true identity of a transacting user by going beyond just device-based analysis, grouping various other entities based on complex associations formed between events.

With ThreatMetrix, eCommerce companies can leverage the largest dynamic global shared network to confidently approve transactions from legitimate users, reject transactions from known fraudsters or bots, detect multiple identities using a single device, and block transactions from devices compromised by malware. They can also detect key situations that put user accounts at risk including:

  • Attempted logins using stolen credentials
    Detect new devices for existing users, attempted logins from unusual locations or via hidden proxies / VPNs, and multiple account access using a single device
  • Logins from risky or compromised devices / users
    Detect unusual device or user behavior that might suggest fraudulent takeover
  • Logins or transactions from known fraudsters
    Real-time updates of blacklisted individuals and credentials
  • Malware targeting logins
    Detect evidence of malware on a legitimate user’s login session
  • Credential replay attacks or session hijacks
    Detect when a device changes between a login and a transaction, or when cookies are copied between devices
  • Botnets automating password guessing
    Detect high velocity password attempts, unusual packet fingerprints, known botnet participation, and other symptoms of a scripted attack

ThreatMetrix Advantage

  • An Unparalleled Network: The ThreatMetrix Digital Identity Network protects 1.4 billion unique online accounts using intelligence harnessed from 2 billion monthly transactions
  • Privacy by Design: ThreatMetrix is unique in its ability to solve the challenge of providing dynamic risk assessment of identities while maintaining data privacy through the use of anonymization and encryption.
  • An Integrated Approach to Authentication: Flexibly incorporate real-time event and session data, third-party signals and global intelligence into a single Smart Authentication framework, to deliver a consistent and low-friction experience with reduced challenge rates.
  • Advanced Behavioral Analytics and A clear-box approach to Machine Learning: ThreatMetrix Smart Analytics analyzes dynamic user behavior to build more accurate, yet simpler, risk models. The result is a competitive edge in customer experience with reduced false positives, while maintaining the lowest possible fraud levels.

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