Credit Unions and Auto Lending
Credit unions are the nation’s largest lender for automobile loans. The allure of a fast, convenient loan drives the business, thus the profitability. However, it also allows for more opportunity to apply for a loan under someone else’s name. Whether direct or indirect, knowing your ultimate customer is of utmost importance. Further due diligence on the front end of the loan cycle could prevent many future loan losses. Be on the lookout for new account openings that are followed by immediate credit and debit cards usage. Credit unions must recognize that someone in that big of a hurry for an advance may not be who they claim they are.
Identity theft related claims are on the rise and have evolved with the advancement of today’s technology. Cybercriminals have become more sophisticated in obtaining people’s information to pass off to credit unions as their own. With the ability to apply for loans online, authentication of a member needs to go beyond a name and a social security number. In a faceless environment such as this, credit unions are encouraged to implement better authenticator practices.
Safeguarding Credit Tips
Credit unions need to require more forms of verification to ensure the validity of loan applicants. Complicated security questions, lengthy pin numbers and intricate password combinations help strengthen the identification of a person beyond a social security number. Encouraging current customers to utilize electronic payment services, such as Google Pay, Venmo, PayPal, and Apple Pay is also recommended. These services alleviate the potential risk of showing any type of information, specifically ID and credit card numbers that could be easily read or photographed. Furthermore, staying up to date on new trends in identity theft protection is a smart defense against cybercrime. As technology continues to evolve, credit unions can use these trends and solutions to do the same.
-Tammy Behnke, Credit Unions Program Executive