In 2024 alone, large-scale data breaches have exposed billions of user records, driving a sharp rise in account takeover (ATO) attacks—now one of the most prevalent and damaging types of online fraud. Recent industry reports indicate a 24% year-over-year increase in account takeover attacks in Q2 2024 compared to the same period in 2023. Additionally, 24% of surveyed consumers reported experiencing an ATO attack within the past year, up from 18% in the previous year, reflecting a troubling upward trend in this type of fraud.
Financial institutions are prime targets for account takeover (ATO) attacks, with fraudsters exploiting weaknesses in traditional account recovery processes, turning what should be a safety net into a vulnerability.
To stay ahead, financial institutions must treat account recovery as an integral part of their security strategy, ensuring it’s as robust and reliable as authentication itself. In this blog post, we explore how Trust Stamp’s Stable IT2 provides a transformative approach to account recovery, helping financial institutions protect their clients and stay resilient against evolving threats while meeting the growing demand for secure, seamless account management.
The Rising Challenge of Account Takeovers in Banking
When customers lose access to their accounts due to forgotten credentials or device changes, the recovery process often becomes a gateway for fraud. A password reset link, a poorly secured verification step—these are the cracks through which attackers slip, causing financial loss and irreparable damage to customer trust. Legacy systems rely on methods such as:
- Knowledge-Based Authentication (KBA): Easily compromised through data breaches or phishing.
- Email Reset Links: Vulnerable if a fraudster gains access to the email account.
- One-Time Passwords (OTPs): Susceptible to SIM swaps, phishing, and trojans.
- Document Forgery: Advanced fake IDs can bypass traditional verification systems.
Once in, attackers often drain financial accounts, make unauthorized purchases, or pilfer sensitive personal information for further criminal activity. These vulnerabilities highlight the need for a transformative approach to account recovery, one that prevents fraud while preserving customer privacy and maintaining a seamless user experience.
Introducing Trust Stamp’s Stable IT2: Purpose-Built for Financial Institutions
Trust Stamp’s Stable IT2 offers a multi-factor account recovery solution designed to protect financial institutions and their customers by requiring multiple factors for both authentication and account recovery. By binding both biometrics and a passkey to the user’s identity, Stable IT2 ensures that only the rightful account owner can regain access—even in the event of a lost password or compromised account.
- Biometric Authentication: The customer’s unique biometric data, such as a palmprint or facial scan, is securely tied to their identity, ensuring that account recovery cannot proceed without their physical presence.
- Passkey: Trust Stamp’s technology provisions secure passkeys to trusted devices. Authentication requires the user to provide both the passkey from a provisioned device and a live matching biometric. This dual-factor approach ensures that even if one factor is compromised, access remains secure, as it can only be granted through the combination of the trusted device and the user’s biometric data.
By combining multiple factors, Trust Stamp’s Stable IT2 eliminates single points of failure within traditional account recovery processes, preventing unauthorized access even if one factor is compromised.
Why Stable IT2 is Ideal for Financial Institutions
- Protects High-Value Accounts: Banks manage sensitive data and large transactions. Stable IT2’s multi-layered approach ensures that only the rightful account holder can regain access.
- Balances Security and Convenience: Customers expect fast, frictionless service. Stable IT2 provides robust protection without complicating the recovery process, fostering loyalty.
- Preserves Privacy: Biometric data never leaves the user’s device, aligning with data privacy regulations and customer expectations.
- Future-Proofs Against Evolving Threats: With fraud tactics becoming more sophisticated, Stable IT2’s biometrics and passkey system safeguards accounts against even advanced AI-driven attacks.
Build Trust and Drive Retention with Stable IT2
By strengthening recovery processes with Stable IT2, financial institutions can enhance their security posture, foster customer trust, and differentiate themselves in a competitive market.
To learn more about implementing Trust Stamp’s Stable IT2 in your institution, contact sales@truststamp.net today.