With numerous high profile hacks at major retailers during the past few years, credit and debit card fraud in the U.S. is up 37.5% to $11 billion from 2012 to 2013 alone (Javelin Strategy & Research). Additionally, annual cybercrime in the aggregate is clocking in at around a whopping $100 billion, according to a study published in 2013 and backed by well known computer security firm McAfee. Demand now appears to be at an all-time high for innovative tech that can help address the underlying causes. Furthermore, m-commerce is growing by leaps and bounds, as smartphone and tablet proliferation continues to progress. This progression has led Goldman Sachs to forecast that global mcommerce will climb some 206% between 2014 and 2018, when it will reach $626 billion on the strength of some 535 million consumers worldwide using mobiles to make a purchase, or nearly the same amount as all ecommerce sales during 2013 combined.
Even if m-commerce currently makes up only around 1% of the $3.25 trillion dollar retail space here in the U.S., m-commerce is nevertheless on track to grab half of all e-commerce by 2018 (GS) and its use is clearly growing at a rate which suggests that the market for innovative tech needed to address the relevant security and usability issues, is quite healthy, and Digi-Capital estimates of venture capital inflows to the sector reinforce this outlook firmly. With some $4.2 billion injected by VCs between 2013 and 2014 according to Digi-Capital’s estimates, a 250% jump over the 2013 figure and a more than 406% increase over 2011 and 2012 combined, there has been an explosion in mcommerce startup activity. However, much of the money has poured into relatively tame m-commerce juggernauts, who lack the innovative security technology needed to really offset some of the major security vulnerabilities that will no doubt continue to plague the sector.
Just the one look at the sticker price on the Target (NYSE:TGT) hack, which compromised some 70 million plus customer’s contact information and 40 million or so customer’s credit and debit card data, whose upper limit was pegged at around $148 million by Target, but is believed by some analysts to have reached $18 billion in the aggregate. Financial institutions alone doled out some $200 million in response to the Target hack, replacing cards and updating customer accounts, and Target subsequently punched the button on a $100 million plan to roll out chip-based credit card technology across its entire footprint as a result of the hack. The breach at Michaels (NASDAQ:MIK) between 2013 and 2014, where the POS system was compromised, led to 2.6 million payment cards being affected and the Home Depot (NYSE:HD) breach, where malware was injected into their POS systems, compromising some 56 million cards and costing HD some $62 million, both illustrate how difficult the m-commerce security problem could become.
Ease of use is going to drive m-commerce forward though, irrespective of the security issues, and TechNavio sees the global space as growing at around a 32.23% CAGR through 2019, but it will be up to innovators like Mobile Lads Corp. (OTC: MOBO) to plug the holes in the dyke with mobile-based solutions like the xmVerify platform they market. Because the xmVerify platform is a bundle of services which combines patented real-time two-way mobile authentication with technologies that foster personalized communication between businesses and their end users, it goes above and beyond simply addressing the need for security, and actually helps solidify businesses’ brand presence and increase their customer retention.
The xmVerify platform lets users review, authenticate and authorize transactions in real-time and also allows for the authorization of overdrafts (xmOverdraft), or increases to a given line of credit, pairing a sophisticated transaction authorization system that enables approval or denial securely from a web-enabled mobile device, with a consumer authorization system that creates a two-way communications link between the company and the customer. On-the-spot authorization meets innovative dialogue enabling in this platform, and businesses are able to send a variety of notices, or other timely data, directly to the customer as well, while simultaneously thwarting digital fraud across both CNP (card not present) and corporate purchase card approval payment types.
Better dialogue between the bank and the customer is beneficial to both parties and a piece of technology like xmOverdraft not only gives consumers the power to opt in for overdraft protection, reassuring them with control over whether or not to permit an overdraft fee, it increases their customer loyalty as well. At the same time, such technology provides the bank or financial institution with an additional chance to capture a transaction after the initial rejection has been made. The added security of the customer being informed any time a CNP transaction is attempted on their account and being subsequently given the choice to approve or deny it, makes it so a thief would have to steal far more than just their credit card data, they would also need the user’s mobile phone and their PIN number. The end result of such improved security is lower fees for the end users, because credit card companies, financial institutions and merchants have lower costs when fraud is delimited effectively.
With the xmVerify transaction authorization system, many online phishing schemes and other typical card theft methodologies are actively, as well as passively, thwarted. Moreover, the xmVerify platform’s use of one of the highest cryptographic standards in existence today, which is also nearly universally compatible with all types of mobile platforms in use, makes the m-commerce technology innovation a serious contender when to comes to grabbing market share amid the continued growth of the sector.
Learn more about this up-and-comer by visiting www.mobilelads.com
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