At Money20/20 this week, I had the opportunity to once again listen to Frank Abagnale’s presentation entitled, Stealing Your Life: Identity Theft. Frank Abagnale, a renowned lecturer and consultant, who penned, “Catch me if you can” delivered the latest key insights about identity theft that allowed us to better understand why he never uses a debit card. (Hint… credit cards offer zero liability while debit cards access your cash directly.)
With more than $994 billion in gross losses in the U.S. due to identify theft, it is more important than ever for card issuers and banks to work together to educate consumers about identity theft. Educating consumers is the single most important tool in fighting identity theft.
Here are some key takeaways:
Identity theft barriers. Stealing one’s identity can be difficult for those that put the right barriers in place to prevent it. Consumers can take simple actions such as using a “micro-cut” paper shredder at home for all their documents, putting in place a real-time credit monitoring service, or avoiding writing checks to mitigate the opportunity for someone to gain your bank account information.
But the fact of the matter is that every two seconds someone’s identity is being stolen, with children and elderly representing the largest targets of stolen identities. Ten percent of children have been victims of identity theft according to a 2011 Carnegie Mellon University study. It’s more important than ever for card issuers and banks to work together to educate parents, elderly and cardholders alike who are all susceptible to becoming a victim of identity theft.
My two bits… Can Prepaid help? Yes, open-loop prepaid cards deliver a huge bump in the road for thieves’ ability to steal cardholder’s identity, while at the same time delivering massive card benefits. So what’s the bump in the road? Prepaid cards do not require consumers to attach a bank account or any personal information, making it next to impossible for thieves to steal one’s identity. Prepaid cards have other benefits too, including financial inclusion for those without a bank account, consumer protection, budgeting tools, avoidance of costly overdraft and interest fees, and prepaid cards are convenient and easy to use.
Invest in technology. It is crucial for card issuers and banks to stay at the forefront of card-technology. At Peoples Card Services we invest to deliver nimble, innovative and cutting-edge issuing services allowing program managers, fintech companies and others to implement, sustain and achieve greater integration, efficiency and control.
Card issuers and banks that deliver innovative financial products on state-of-the-art PCI compliant technology and provide extensive support and education to its partners, will be the most helpful in preventing cardholders from identity theft.
Count on the experts. Every cardholder expects that the payments players who create the cards that are at the top of consumer’s wallets are true subject matter experts, ensuring security features are employed that protect them against identity theft.
Fintech and program managers are the experts in delivering payments solution and developing technology, but they need to lean on card issuers like Peoples Card Services who are card issuing experts. Together, card issuers, fintechs and program managers can partner to maximize anti-fraud measures and protect cardholders.
Ode to Frank Abagnale who helped remind an audience filled with payments professionals at Money20/20 the importance of protecting cardholders from the ever-growing identity theft problem. In line with Abagnale’s message, Peoples Card Services continues to educate its partners about the importance of leveraging the right experts who can help navigate regulatory and security requirements, capture growing market demand and help program managers accelerate their card programs across the payments sector, resulting in consumers feeling inherently safe when they swipe their favorite prepaid cards.