These Are 3 Tips to Protect Your Online Business!
Nigerian online business owners can expect to see a seasonal surge in online fraud right before Christmas holidays every year. We can’t but agree that when buying activity actively grows and, as a result, the need for credit funds grows too.
And right before and during the festive season the number of loan applications grows at least 1.5 -2 times.
The main risk that Fintech company owners usually face during this period is a sharp increase in the flow of fraudulent applications. How exactly does this happen? Fraudsters repeatedly submit loan applications to different financial institutions, manipulating data from application to application in order to “slip” through an online lender’s decision-making system.
Speaking with Mikhail Marchenko, Co-Founder at JuicyScore, risk management and antifraud global firm, he has taken the time to prep a watch list to protect your business from Christmas online fraud.
According to Mr. Marchenko: “Let starts with some numbers: total losses from online fraud between 2023 and 2027 are estimated to exceed 343 billion USD globally, according to Juniper Research report, and experts predict that this figure will grow to $ 40.6 billion by 2027.”
“What do fraudsters count on? First of all, they know that the attention of online lenders will be scattered due to the large flow of applications. Also shortened working hours during the holiday period often lead to the situation, when fraudsters’ applications are more easily approved due to oversights.”
Therefore, JuicyScore team highly recommends to follow these steps:
- Temporary tightening of the company’s risk policy regarding the applications valuation – applying a more conservative approach will help protect online business from possible financial losses;
- Be really attentive to the applications with high-risk markers, for instance, such as attempts of device or internet connection manipulation, the use of randomizers, untypical device settings etc.;
- Apply more conservative approach connected with the frequency characteristics.
Lawrence Osayemi, Sales & Business Development Regional Director in Nigeria at JuicyScore says: “Nigeria is currently experiencing an evolution in how credit decisions are being made. Outside the traditional credit evaluation systems based on pieces of information like credit history, payment history, debt ratios, etc (Which further excludes a large number of people with no credit history) lenders are now leveraging alternative data, AI and ML to strengthen customers’/business profiles and this means they can say yes to more people.”
Speaking more on this, he commented “However this type of data is also very useful in terms of seasonal fraud reduction, because alternative non-personalized is extremely valuable when we speak about credit decisioning during high load on decision making system.”
