CTOS Digital claims its IDGuard had screened over 4.2 million applications in its first 24 months of operation and detected and prevented fraudulent credit applications to the tune of RM193 million in the latest figures released.
CTOS says this had also heightened the risk for the financial services industry given that traditional in-person biometric verification is no longer possible in the online space.
CTOS fraud bureau works by scanning credit applications in real time and checking them against its extensive database, as well as against every application made through all partner banks in the system. With the addition of analytics and machine learning, CTOS IDGuard is then best positioned to identify any potential fraudulent behaviour and bring it to the attention of banking partners.
“As the region’s first application fraud bureau, CTOS IDGuard is pioneering new ground in the battle against credit application fraud through data, analytics, and innovation through the benefits of machine learning,” commented Erick Hamburger, Group CEO of CTOS Digital Berhad. “Currently the credit providers using CTOS IDGuard to scan applications hold more than two-thirds of the total banking assets in Malaysia. With access to real-time, accurate, shared data, we are empowering financial institutions to recognize fraudulent applications instantly, so that the consumers that deserve credit, get it as quickly and cheaply as possible.”
The application is currently being used by major Malaysian financial institutions, including Maybank, RHB, CIMB, Alliance Bank, Hong Leong Bank, AmBank and BMW Financial Services, while further banks are in the midst of adopting the system and other major financial institutions are also showing interest.
Over the past two years, CTOS IDGuard found that 4.2% of mortgage applications have been flagged as potentially fraudulent or suspicious, the highest alert rate among application portfolios. This was followed by personal loan application alerts at 1.8%, credit card applications (1.3%), vehicle loan applications (0.9%), SME loans (0.7%), and other applications (0.5%).
In terms of total confirmed cases, credit card applications make up the significant majority, contributing to 44% of confirmed known fraud and suspicious applications. Interestingly, a third of all confirmed cases are generated due to applications made by known fraudsters or syndicates, which CTOS IDGuard is able to flag by utilising the multiple pools of partner data analysed by the fraud bureau.
