The latest tool to fight identity theft may already be in your pocket – it’s your mobile phone. Using a new solution from Clickatell, a mobile messaging service provider, consumers can be alerted to suspicious bank transactions via text message. The service called Clickatell SMS Receipts notifies banking customers of account activity via SMS alerts. With this real-time information, consumers are instantly able to verify legitimate use of their account or detect fraud.
According to Gartner, 7.5% of U.S. adults lost money as a result of financial fraud in 2008. And a recent Javelin report claims the number of identity theft victims increased 22% in 2008, impacting more than 9 million people with an average cost per incident of $500.
Not all identity theft is through electronic means. Although some of the incidents include cyber fraud, there are still plenty of cases where physical theft, including lost and stolen wallets and checkbooks, is a factor.
But when fighting the ever-growing identity theft problem, technology gives financial institutions an edge. However, leaving the battle entirely in the hands of banks may not be the solution. Despite the anti-fraud technologies and methods financial institutions employ, their customers may be the most important and effective factor in preventing theft. Says James Van Dyke, president and founder of Javelin, “Customers can be just as effective…because one out of two fraud cases is first detected by the customer.”
With the new technology from Clickatell SMS Receipts, customers can either verify or cancel transactions as they occur in real-time. If fraud is detected, it will be spotted almost instantly.
Clickatell’s solution isn’t the first example of SMS technology being used in this manner – earlier this year Barclays Bank implemented a similar service. But Clickatell is already being put to good use. E-Wallet provider Moneybookers is using the service, as is Santam, S1 Corporation, and First National Bank of South Africa. In addition to this fraud prevention service, Clickatell also partners with financial institutions to provide SMS-based banking which allows for balance inquiries, fund transfers, and person-to-person payment services. This sort of technology offers more than just modern-day convenience – it also lets people take advantage of banking services from anywhere in the world, even when they’re far away from a branch or ATM.
