Combat Fraudulent Activities with SMS Verification
It is no news that online messaging platforms have hijacked the traditional texting service without warning. With the facility of fast internet connection and instant messaging apps in the pockets, almost everyone is using some online messaging platform to communicate. And while we thought SMS is nearing its end, good news in the form of “SMS verification” surfaced in the market. It transformed the basic purpose of Bulk SMS, by making it a transactional platform.
A major reason for using SMS as a verification platform was because SMS had a high open rate of 98 per cent which is 60% higher than email.
This noticeable difference in the user preference led a growing number of businesses to adopt SMS as their verification tool ranging from big tech giants namely Google, Facebook to ride-hailing & food delivery app namely Uber and Zomato. Almost every industry and app have now started using SMS verification platform at multiple stages of their user’s journey. Below are six such business cases where SMS verification has strengthened the security of apps and has helped the business to combat online fraud effortlessly.
1. User Registrations
Growing businesses are flooded with registration requests. But to ensure that no unauthenticated or fake users intrude into the system, they need to verify the identity. Traditional password-based authentication proved to be weak and insecure in the past. Any fake user with multiple email IDs could easily create multiple user registrations to spam the system.
Here, asking users to register with their phone number helps in filtering many potential spams during the initial phase, i.e., registration process. Validating the user by sending a One Time Password on the provided number provides maximum security in the registration process. It prevents frauds explicitly in two ways with sms verifcation: –
It detects if the number used at the time of registration is already associated with the company or not, to prevent any spamming.
And, whether the existence of the phone number is real or fake by validating with the received OTP
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2. Password Reset
To make the passwords highly secure, many platforms prompt users to create complex, lengthy and unique passwords. While this SMS verification method makes the password hard to crack, it also becomes hard to memorise, which leads to a lot of password reset requests.
In such cases, sending an OTP code on the associated phone number prevents a lot of fraud and identity theft. Also, makes the password reset process a lot easier for genuine users. Every time users want to reset a password, a simple text message with OTP codes can help them to do the same quickly. And the limited time validity of the OTP codes adds on to the security of this process.
3. Two-step Verification
65% of people use the same passwords everywhere, and 90% of passwords are crackable within 6 hours. Thus, stealing passwords and hacking into account is not hard for hackers. Moreover, sharing passwords with peers or family members or using the same password over multiple platforms is a general practice followed by the users. This makes it easy for the cybercriminals to hack into user accounts.
Two-step sms verification adds a layer of security while logging into the account. After the user enters their password, they’re asked to enter the OTP code received in the textbox. These OTPs are instantly generated and are valid only for a few seconds which reduces the probability of an unauthenticated login to the minimum. Google has been promoting the two-factor authentication rigorously to prevent user accounts from any fraud.
4. Reactivate Users
When a registered user logs into their account after a long period of inactivity, suspecting the legitimacy of the activity is imperative. Many times, the request can be genuine, but there is a high probability that an attacker is trying to activate a passive user login to break into the system.
To handle such cases, sending an SMS to the phone number used at the time of registration works as the best solution. This immediately verifies the nature of the activity and helps the business to tackle it promptly.
5. Order Verification
Fake orders and frauds are a prime concern for any e-commerce platform. This platform has provided a convenient method for people to shop online, but at the same time, it is important to handle the lapses this convenience entails. And the criticality multiplies with the increase in the number of high-value orders.
Using SMS verification on high-value orders prevents many fraudulent purchases. Sending a simple order verification OTP to users at the checkout page makes the process more authenticated. The order gets successfully placed once the user validates the OTP. This kind of verification keeps a check on the rising number of e-commerce fraud without complicating the purchase process for the users.
6. Transaction Authentication
Financial transactions are critical and are thus most vulnerable to online fraud. Earlier, ATM pins were used to ensure the safety of the transactions. They were considered secretive and private and thus guaranteed more security. But with expanding online fraud, breaking into your ATM pin during the online payment process became a cakewalk for the hackers.
To battle such critical and sensitive frauds, the introduction of OTP verification proved to be a significant step. It reaffirms the transaction authenticity before the final payment. Also, it hardens the process of breaking into an online transaction as the validity of OTPs is for a brief time, which leaves hacker with less time and incomplete information to break into the system.