Your Guide to Using SMS for Fraud Protection

The cost of fraud is always on the rise. A study by the Journal of Financial Crime found that 56% of surveyed UAE businesses lost more than AED 500k due to fraud in 2021. Any business with an internet connection is vulnerable to fraudsters, who are constantly finding new ways to exploit weaknesses in security systems.

This can cause a business to lose not only money but also the trust of its customers. In order to protect both their bottom line and their reputation, businesses need to invest in fraud prevention measures.

One of the most effective fraud prevention tools is SMS verification. By requiring customers to verify their identity with a one-time code sent to their mobile phone, businesses can make it much harder for fraudsters to gain access to accounts or make unauthorized transactions.

What is Multi-Factor Authentication?

Multi-factor authentication (MFA) is an authentication method that requires the use of more than one factor to verify a user’s identity. The most common MFA method is two-factor authentication (2FA), which combines something the user knows (such as a password) with something the user has (such as a code sent to their mobile phone).

How Does it Make it Harder for Fraudsters?

SMS verification makes it much harder for fraudsters to gain access to accounts or make unauthorized transactions because they would need to not only have the password but also access to the victim’s mobile phone to receive the one-time code.

Most cybercriminals retrieve data through a method called phishing, where they trick users into entering their login credentials into a fake website or app that looks legitimate. Once the fraudster has the victim’s username and password, they can log in to the real website or app and wreak havoc.

With SMS verification, even if a fraudster is able to obtain a victim’s login credentials, they would still be unable to log in because they would not have access to the victim’s mobile phone to receive the one-time code.

How Can SMS Play a Role in MFA?

There are a few different ways that SMS can be used as part of an MFA system. Each method has its own set of benefits and drawbacks that businesses need to weigh when deciding which option is right for them. Ultimately, the best solution is the one that strikes the right balance between security and user experience.

As a one-time code

A one-time code is a randomly generated number that is valid for a single use. This type of code is typically six digits long and is sent via SMS to the user’s mobile phone. The user then enters the code into the website or app to verify their identity.

As a link

A link is sent via SMS to the user’s mobile phone. The user clicks on the link, which takes them to a website or app where they can verify their identity.

As an access token

An access token is a string of characters that gives the user access to a website or app. This type of MFA is typically used by businesses, as it is more secure than a one-time code.

What is the Unifonic Solution?

Unifonic’s SMS authentication and verification API is a simple and effective way to add an extra layer of security to your business. Our platform makes it easy to send one-time codes, links, or access tokens via SMS, so you can choose the option that best suits your needs.

With Unifonic, you can be sure that your customers’ data is safe and secure. We offer a variety of features to help you protect your business from fraud, including:

Two-factor authentication

With Unifonic, you can require customers to verify their identity with a one-time code sent to their mobile phone.

Account verification

Unifonic’s account verification feature helps you prevent bots and fraudsters from creating fake accounts.

Login verification

The login verification feature with Unifonic ensures that only authorized users can access your website or app.

Transaction verification

Unifonic’s transaction verification feature adds an extra layer of security to important transactions.

Applying these fraud prevention measures will help you keep your business safe and secure. They will make it substantially harder for fraudsters to gain access to your accounts or make unauthorized transactions as well as increase the chances of detecting and stopping fraudulent activity before it causes significant damage.

Unifonic’s Authentication API solution is a valuable tool that can help you protect your business from fraud. Contact us today to learn more about our platform and how we can help you keep your business safe.