How to Build a Holistic Authentication Management Strategy

As financial Institutions (FIs) respond to the changing interaction and transaction behaviors of the new normal and prepare for a post-pandemic future, the context of the user experience (UX) is being reshaped. Face-to-face interactions have been replaced by digital ones, and FIs are revving up their digitization efforts to deliver more secure customer journeys amidst a broadening fraud landscape.  

However, expanding transformation initiatives and unprecedented technology adoption often comes at the expense of the UX, notably when robust cybersecurity agendas result in overly complex, frustrating authentication processes. FIs are implementing more advanced methods for authenticating user accounts and identities to mitigate potential customer privacy vulnerabilities and drive risk-based decisioning, but they must simultaneously ensure that they’re meeting new demands for a streamlined, comfortable UX.   

Authentication management encompasses the processes that verify a user identity matches the provided user ID and password. These processes must be improved with intelligent, non-intrusive authentication solutions and holistic strategies that effectively protect user data and fulfill user expectations.   

This approach includes managing authentication technologies and implementing processes on an operational level to help to control a frictionless experience for users across the value chain in order to reduce costs, improve efficiency and establish trust.  

Types of Fraud Authentication 

• 2 Factor Authentication (2FA): In addition to using a password to login to an account, a user must provide an additional type of authentication to access their account or particular service, like using a phone number to verify their identity. Adding two layers of security is more secure than traditional password and login, and can be cost-effective. However, it’s more time consuming and expensive to implement than traditional password and login security measures, which might be a barrier for small to midsize organizations. 
• 3 Factor Authentication (3FA): Requires three types of authentication, like a password, phone number, and biometrics, to verify account access. 3FA is typically secure and doesn’t add much friction to the end user except for a more time-consuming account access process. But this solution is complex to implement across large organizations or enterprises. 
• One-Time Password (OTP): When a user loses their password or is a new user, they might get a passcode that consists of letters and or numbers that can only be used once. OTP are inexpensive, easy to scale, and don’t require any additional hardware. 
• Biometrics: The most common use of biometrics that users encounter are using fingerprints to digitally authenticate identity. Biometric authentication methods are quickly implemented because many smartphones have this type of technology built in, and this type of information is secure because it’s not easily duplicated. However, the technology is expensive and biometric data can still be stolen without proper data security.
• Mobile Authentication: Mobile authentication is the process by which mobile devices are verified when users access accounts from any location, including verification using one time passwords, phone numbers, or biometrics. 
• Continuous Authentication: Common with web and API services, a company can continuously authenticate a user over time and monitor their actions as they interact with the service or application. This provides a constant layer of security without any unnecessary login attempts by the user that can potentially cause a poor UX. It monitors and flags any abnormal behaviors by comparing user actions to previous sessions. In the case of a security breach, every action can be tracked to examine more information about the breach. 
• Application Programming Interface (API) Authentication: Systems need to validate each end user, which is done by sending credentials to a remote access server. API authentication methods include HTTP, OAuth, or API Key. It’s an effective option because every end user is validated according to each system they access. HTTP is easy to set up, however passwords are not encrypted. OAuth provides a smooth UX but is more difficult to maintain. API Key Authentication improves implementation for application developers.  

Building a Cohesive Authentication Management Strategy 

It’s critical to adopt an authentication management strategy across the entire customer journey lifecycle that balances security and usability throughout all aspects of user engagement across channels.  

A comprehensive, enterprise-wide approach to authentication management should be prioritized, but this can be challenging given the scope of available authentication methods and the respective impact on partners, employees, suppliers, and customers. 

Furthermore, FIs must establish a culture that promotes a deeper understanding of the best methods to deploy authentication across the organization at scale, and reinforce the behaviors and requirements necessary to avoid a poor UX or compromise security. 

A holistic authentication management strategy should also include:  

• Identifying the technologies that will be used to prevent fraud, ensuring that they work well together, and that hardware and software requirements are met. 
• Allocating responsibility roles for specific authentication requirements, and connecting authentication protocols across different channels.
• Identifying risk priorities and what weaknesses might be exploited. 
• Taking steps to perform ongoing monitoring and reporting to continuously adapt the solution to changing conditions.
• Promoting strong governance standards to support regulatory and compliance policies. 

Additionally, FIs should take care to verify the potency of their authentication strategy in both fraud prevention and customer impact, as well as any changes that ensue as a result of solution deployment. Enabling customers to personalize their own form of authentication according to their comfort level and security preferences can help in this regard. 

Orchestrate Unified Fraud Authentication Management   

Traditional authentication methods, such as simple login and password identification, are no longer meeting security and data privacy needs as organizations encounter new fraud threats. Advanced analytics-driven authentication management solutions, like Authentication-IQ, can enhance enterprise security programs and facilitate an efficient, frictionless UX to help organizations deliver safer, comfortable digital experiences.

Authentication-IQ from NICE Actimize allows FIs to connect authentication strategies with fraud risk intelligence to holistically connect authentication processes across all channels and transactional behaviors. FIs are able to accurately identify suspicious user behaviors based on robust historical authentication activity and mitigate potential cross-channel attacks. 

A solution like Authentication-IQ promotes optimized, enterprise-wide workflows and a unified context for alert and case management, providing a centralized source of truth for all existing authentication tools and solutions. 

Automated business intelligence, like that offered by Authentication-IQ, fortifies organic approaches to investigation based on simplified interfaces and customizable, consolidated alerts.   

This solution can help FIs improve the resilience and efficiency of their authentication management and fraud prevention strategy by ensuring access is granted to the right users without causing undue user frustrations, or stalling workflows or system access.   

Click here for more resources and insights about authentication management and how to support a holistic authentication experience.