Since the development of traveling, the travel and tourism industry has constantly gained popularity, leading to it becoming one of the largest industries in the world. According to the World Tourism Organization, there were 1,460 million international tourist arrivals in 2019 alone, making it the 10th consecutive year of sustained growth. Unfortunately, Covid-19 put a stop to this development as countries and even cities have imposed travel restrictions to deal with the spread of the pandemic. But, nothing can extinguish the flame of love for traveling, which is why it is only a matter of time until everything goes back to relative normal and people start traveling again.
Unfortunately, this means that all of the bad things that the travel and tourism industry needed to deal with before, such as fraud attempts, will also come back. Luckily, cybersecurity experts weren’t standing still, letting the bad actor get ahead of them. They keep developing more sophisticated cybersecurity strategies such as KYC services to protect businesses and their customers against fraudsters.
What are the most common types of travel fraud?
Fraudsters keep coming up with new ways of scamming innocent people and businesses out of their hard-earned money, and these are the most common ways they do it in the travel and tourism industry.
Stolen Credit Cards: Fraudsters use stolen credit cards to purchase a product from an airline, travel agency, or hotel. They can then resell it, cancel it in exchange for the credit or a gift card or even use the service before the legitimate card owner notices anything. Eventually, the card owner will request a chargeback, additionally damaging the business.
Fake Travel Agent or Hotel Sites: Fraudsters create fake travel agencies or hotel websites where customers can book their service. When a customer tries to use that service, they will discover that it doesn’t exist. Sometimes fraudsters will even use the customers’ payment details for further purchases.
Account Takeover: Fraudsters will gain access to customers’ accounts via cyberattacks and use the account for unauthorized transactions.
Once the travel comes back, it will come back with a bang. You need to be prepared to deal with all the changes brought by pandemic to stay ahead. By knowing what malicious actions you might encounter, you will be able to prevent them from damaging your business.
How to use KYC to protect your business
Customers are the most valuable element in the hospitality industry, which is why customer satisfaction is a priority of any hospitality business. But, this can result in companies not having proper cybersecurity strategies in place as they don’t want to inconvenience their customers. But one doesn’t have to exclude the other. By implementing Know Your Customer or KYC practices in your business, you can validate customers’ identities and avoid user friction. By knowing as much as you can about your customer, you can prevent fraudsters from pretending to be legitimate customers and exploiting your business.
While the level of KYC requirements will vary depending on the needs of the business, its goal will remain the same. KYC offers businesses a unique opportunity to gather important information about the customers to determine their intentions, confirm they are who they say they are, and prevent any fraudulent activities while staying compliant with government regulations. While you could do this manually and check one by one customer, KYC software makes this process faster, more straightforward, and more cost-effective. Just imagine how much time and money you would lose if you had to employ someone to review all the customer purchases manually. Implementing KYC software improves this process for the business and the customers.
KYC can significantly improve your chances of reducing travel fraud; it works best in combination with other cybersecurity tools such as data enrichment or email lookout tools. Implement the complete cybersecurity strategy, and protect your business from any threats that might arise.