Card Issuers Identity Safety Scorecard
New study ranks credit card issuers on identity safety…
A recent Javelin Strategy & Research study, a leading independent provider of nationally-representative, quantitative research focused exclusively on financial services, ranked 25 of the nation’s top credit card issuers on identity theft prevention services and education. Twenty-five of the nation’s top credit card issuers were scored against a benchmark of highly-specific safety criteria for each category which included: Prevention, Detection and Resolution. The Prevention and Detection categories were weighted more heavily than Resolution due to the greater potential benefits and cost savings. Here’s a summary of the results:
- Top Honors went to Bank of America
- 2nd Place went to Discover
- 3rd Place went to FNB Omaha and U.S. Bank
“Last year, identity fraud reached $45 billion in losses and affected 8.1 million American consumers, so identity protection is now a mainstream issue with considerable public awareness,” said James Van Dyke, President and CEO of Javelin Strategy & Research. “In the case of this year’s Credit Card Issuer’s Identity Safety Scorecard, Javelin research demonstrates that concerns about identity fraud not only influences consumers purchasing behaviors, it defines what credit cards they decide to use.”
The top three issuers in the three specific categories:
Prevention: Bank of America, FNB Omaha, Discover
Detection: American Express, U.S. Bank, Bank of America
Resolution: Top honor shared by 7 issuers - American Express, Bank of America,
Discover, JPMorgan Chase, State Farm Bank, Wachovia and WaMu
Advances in consumer safety and fraud prevention include:
- 84% of issuers offer secondary passwords for Internet purchases through programs such as Verified by Visa and Mastercard SecureCode.
- Increased numbers of consumers use electronic statements - which not only helps reduce the risk of identity theft - but also helps the environment.
- The number of issuers who warn their cardholders when their personal information is compromised rose from 16% in 2007 to 56% this year.
Here were some problems discovered by the research:
- Many issuers are not providing consumers with the ability to specify limits on particular types of account activity. Only 24% of card issuers provide user-defined limits and/or prohibitions (UDLAPs) on cash advances.
- More than half (56%) of top card issuers still require full nine-digit Social Security numbers when interacting with customers, whether by phone, Internet or mail. This is a risky practice that unnecessarily increases the customer’s exposure to identity fraud.
- Many credit card issuers do not offer transaction alerts for transactions such as past due payments, new account set up, foreign transactions and emergency card replacements which could also indicate fraud.
The Credit Card Issuers Identity Safety Scorecard research employed statistical analysis, review of features and policies on card issuer websites, and mystery shopping with multiple senior level customer service representatives. To find out more about this and other studies, visit the Javelin Strategy & Research website.
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