Research conducted for global information services company Experian estimates that £14.4m worth of online gaming transactions were abandoned last year by UK consumers frustrated by older and inefficient identity checks.
One in five of these abandoned transactions were not taken elsewhere as individuals cancelled their sign-up attempt altogether.
The study, which was conducted by the International Fraud Prevention Research Centre and included survey data as well as insights from online retailers and the Office of National Statistics, revealed that 44 per cent of UK consumers have abandoned at least one online transaction in the last year having become frustrated with the length and complexity of certain older forms of identity verification.
Older forms of online identity verification, typically complex, stand-alone systems drawing on single sources of information to corroborate identity information, are unable to validate as many individuals electronically as modern services. As a result, genuine customers might be forced to call a contact centre, submit physical documents through the post or visit the store or branch to confirm identity. Alternatively, the organisation might choose to accept a lower level of proof and risk higher levels of fraud in order to minimise customer inconvenience.
Nick Mothershaw, UK director of identity and fraud at Experian, said: “The UK has lost millions from inefficient online identity and security measures and it is a price that doesn’t have to be paid given that technology now enables incredibly robust identity checks to be undertaken almost instantaneously.”
Professor Paul Barnes, director of the International Fraud Prevention Research Centre, added: “Depending on the reason for the identity verification check, our tolerance during a transaction varies greatly and can be as short as a 60 second window. With millions potentially being lost from the key industries in the UK, it is vital that this issue is addressed as soon as possible.”
