If you want an online car loan, be prepared to prove that you really are you.

Consumers applying for online credit, such as car loans and credit cards, had better get used to the idea of ​​being screened in the near future by so-called “biometric” means such as fingerprints or eye scanners.

These technologies have become widely available and relatively more economical. Above all, however, the need for greater security is urgent, according to a recent phone interview with Chris Ryan, senior anti-fraud solutions consultant for Experian, based in Costa Mesa, Calif.

The data breaches revealed so much confidential customer information that today’s common means of verification aren’t as reliable, he said.


At the same time, more and more auto finance transactions and other financial transactions are taking place exclusively online. This means that there may be no ability for a lender or car dealership to verify an applicant’s identity in person – or even to verify that an applicant is a human being, as opposed to a “bot,” software designed to mimic a bona fide loan seeker, Ryan said.

“It’s a pervasive problem,” he said.

Increasingly, scammers with access to stolen information can outwit usernames and passwords, and even so-called “out-of-wallet” questions, like the brand of the first car you owned. “Two-factor” identification, such as texting a code number to your cellphone, can also be tricked, Ryan said.

Identity theft is a growing problem, especially so-called synthetic identities, where fraudsters cobble together a fake identity using fragments of genuine identities.

Car loans are a particular target, as the increased use of chip credit cards has made it much more difficult to create fake credit cards, security experts said. This makes auto loans handy fruits in comparison.

The good news is that consumers are saying they’re fine with new technologies aimed at confirming their identity – provided they’re confident there’s a return in terms of added security, according to a research report from Experian.

“One of the big takeaways from the report is that there’s been this historical perception that safety and convenience are opportunities, that safety has to be sacrificed to make it easier for the consumer,” Ryan said.

“But the report pointed out that people said they would share more data if there was a perceived benefit, i.e. greater security,” he said.

In a survey, consumer confidence in the online process increased from 43% to 74% when physical biometrics were used to protect their accounts, according to Experian’s latest Global Identity and Fraud Report.

Priscilla C. Carnegie