While credit risk—the risk that a borrower will default on a loan—is remarkably high in online lending, fraud risk exposure for short-term lenders has been a growing concern since the business shifted online. Due to the anonymity involved, identity thieves and first-party fraudsters have been targeting online short-term lenders since the industry's adoption of the Internet as a major customer acquisition channel. Device recognition provides a crucial layer of fraud protection for online lenders.
This lender needed real-time fraud detection that could handle information from multiple brands, websites and loan products, and that reduced manual review queues. Within twenty minutes of implementing iovation's risk service the lender stopped a fraud ring that was presently active on its website. The firm is now saving $5 million in annual losses with early fraud detection.