Loading...

Are you protecting your small business owner customers from fraud?

May 16, 2011 by Guest Contributor

By: Kristan Frend

Small business owners appear to be lucrative targets for identity fraud perpetrators, alarming banking institutions, payment processors, and B2B service providers. According to Javelin’s 2011 Small Business Owners (SMBO) Identity Fraud report, the cost of fraud and identity theft “hit SMBO constituents particularly hard. Javelin research uncovered what was previously an undocumented cost to the industry of $5 billion as a direct result of this fraud. In addition, financial institutions (FIs) lost over $590 million in clients and revenue opportunities over a fiveyear period.”

Additionally, the report indicated that small business owners mean fraud amount is about 5% higher than that for all consumers ($4,851 vs. $4,607). Even more alarming was the fact that the SMBO’s mean victim cost is 150% higher than consumer costs ($1,574 vs. $631).

So what does all of this mean? If you’re a small business lender or service provider, having a robust multi-layered SMBO fraud prevention program in place is essential for client retention and avoiding reputational risk.   You can take control of the situation with more proactive fraud prevention strategies which will improve your relationships with SMBO customers and save them (and you) money in the long run.

Related Posts

Anti-money laundering and fraud prevention have historically been separated, but here's why that might not be a good idea.

March 27, 2024 by Julie Lee

Know Your Customer (KYC) procedures are a requirement for banks and other financial institutions to collect and verify the...

March 21, 2024 by Stefani Wendel

Property managers must leverage a solution that provides accurate, efficient, and compliant income and employment verification.

March 13, 2024 by Ted Wentzel