With an estimated annual loss to the industry of $38 billion, fraud management and prevention are understandably important topics for telecoms operators, especially in the areas of roaming fraud and identity management.

Blockchain has the potential to reduce industry losses due to roaming fraud, and to minimise costs for fraud detection applications.

Often, after roaming call data has been collected, there can be days to wait before being able to access data call records from an overseas telecom service provider. It is this ‘window of opportunity’ that organised crime can exploit when attempting roaming fraud. Such roaming fraud can be overcome by automatic triggering of a roaming smart contract which enables instant charging.

A physical SIM card can easily be obtained by SIM cloning or email phishing to commit identity fraud using false identification. A more secure route is offered by blockchain: an eSim – associated only with a single device – makes it difficult to steal, and helps to protect private information which is encrypted in a private ‘key’. A public key is used to identify the device, authorise it on the network and offer a unique identity, whilst keeping the private key information secret.

Blockchain adoption could optimise ID management through instantaneous and automated processes based on smart contracts, replacing the need for many username/password combinations and overcoming the challenge of personal data being shared with third parties. Telecoms operators could then utilise the significant amount of subscriber data that they hold, by providing identity-as-a-service to partners and subsequently allowing for additional revenue generation.