Speed vs. Security: the Digi Bank Dilemma

Digital-only banks promise speed and sleek digital experiences but are not the best at caring for financial scam victims. Without branches to visit, victims find themselves stuck in a loop of chatbots, said Jason Costain, former head of fraud analytics and threat management at NatWest Group.

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“Everything is fine until there is a significant problem … when somebody is scammed, and then the bank becomes difficult to deal with because quite often you need to speak to somebody,” Costain said. While fintechs excel at digital innovation, they often fall short in crisis moments, he said. Victims of fraud may need urgent help, but without phone support or trained staff, many end up navigating ineffective automated systems that leave them frustrated and unprotected.

Many digi banks were not built for dealing with complexity. he said. Some operate without call centers or trained fraud teams, relying heavily on web-based chat apps that fail in crisis situations.

In this video interview with Information Security Media Group, Costain also discussed:

• Why scam victims turn away from digi banks after poor service;
• The regulatory push forcing faster scam reimbursements;
• How gaps in fraud monitoring are being exposed by scam payment data.

Costain has spent 30 years fighting fraud, building and leading successful banking fraud defense teams for some of the world’s biggest banks. He specializes in fraud defense systems, APP fraud, biometric authentication, big data and artificial intelligence.