American Express has bought InAuth, Inc., a company specializing in providing customers with mobile device authentication and intelligence solutions. Amex already uses InAuth’s fraud management capabilities as part of its security measures. With this move they enhance their comprehensive data analytics and fraud prevention abilities, which have already helped them fight fraud – giving them some of the lowest rates according to the card issuer.
“Security is part of our heritage, and helping our merchants and partners fight fraud is a top priority for American Express,” said Anré Williams, President, Global Merchant Services & Loyalty Group at American Express. “We’re acquiring the right company at the right time to evolve our leadership position in fraud management and security. This acquisition, along with Acetify and other significant investments we’ve made in data analytics and technology, will help us continue to offer security and protection to our merchants and partners as mobile and online spending drive commerce.”
New Opportunities on the Horizon
InAuth is not a new company. Their tech has been used by large banks, financial institutions, merchants and payment networks to help lower the risk of fraud, while also assisting with identifying potential fraud, using their mobile-first device authentication capabilities.
With this acquisition Amex is on point to take advantage of new consumer-driven opportunities, especially those that develop due to the shift from real time sales to online and mobile ones. On these digital channels the risk of fraud goes up with the shift to digital streams.
In the 2016 American Express Digital Payments Security Survey they found that 70% of merchants in the U.S. reported increased sales generated both online and mobile streams when compared with last year. Yet, along with that upswing 60% of merchants also indicate that they have experienced fraud from sales generated via these methods.
InAuth was launched in 2011, and is designed to assist their clients with identifying risks, as well as reducing fraud across their digital channels. Device authentication is used to help clients determine the possible risk associated with digital transactions, which can mean anything from a customer using a mobile app or web browser to accessing their account to actually buying merchandise or services via a website.