At first glance, LifeLock’s $42.6 million acquisition of Lemon may not seem to fit quite right.  To some it may appear that LifeLock is buying access to Lemon Wallet’s user base, but an app with 3.6 million downloads does not justify that kind of investment on its own.  As for LifeLock getting into the mobile payments game, the last thing the market needs is another also-ran.   

Fortunately, all is not as it seems because LifeLock may have actually found a way to avoid the rampant customer turnover which has been plaguing the identity protection industry. Obviously, LifeLock gets a mobile app through which they can deliver their identity protection services.  This is a present-day necessity given consumer expectations for always on, instant access, but there is a second, more substantial benefit which LifeLock obtains from the wallet’s key financial feature.  Users can upload payment card details into the wallet, so that they (and LifeLock) can subsequently monitor these accounts directly through the app. So how do these features create the kind of value that keeps customers coming back month after month?

When it comes to identity fraud, the name of the game is money, pure and simple.  Criminals commit fraud to get paid, and in order to do so they often misuse the financial accounts of unknowing victims.  Unfortunately, the identity protection industry’s foray into monitoring for financial fraud has taken a number of years and has suffered its share of setback. 

LifeLock’s settlement with Experian over fraud alerts on credit reports took the collective wind out of the industry’s sails.  Slowly but surely LifeLock has been working its way back, though the purchase of ID Analytics and a partnership with Early Warning. They have since managed to create a respectable financial account monitoring capability spanning everything from DDA accounts to payday loans, but comprehensive payment card monitoring was the missing piece of the puzzle. That piece of the puzzle was the big one.  The keystone piece you notice when you open the box and can figure out exactly where it goes. By being able to quickly detect and alert their customers of the majority of financial fraud types, LifeLock should be able to better protect their customers than they could in the past while also strengthening the relationship with their customers.  A significant portion of consumers who cancel identity protection subscriptions do so because they don’t see the value in it.  Providing conspicuous and robust financial fraud protection is exactly what is needed to create that perceived value and keep customers around for the long term. LifeLock and Lemon Wallet? 

They fit.


About Mark Schwanhausser

Mark strategizes how financial institutions can track and serve customers across the channels they use, and provide a consistent, integrated brand and user experience. Mark helps banks and credit unions profitably enable customers to monitor and manage their money more intelligently through technology such as online banking, mobile banking, personal financial management, financial alerts, and technologies on the horizon. 

Mark led the development of Javelin’s Digital Banking Maturity Path, a strategic framework for assessing a financial institution’s ability to deliver advice in digital channels, and the Financial Journey Model, which builds digital banking on a foundation of time-tested personal finance principles. He has also mapped out strategies to upgrade online banking, digital account opening, and financial alerts in a mobile-first era. 

Before joining Javelin, Mark was a personal finance reporter for the San Jose Mercury News. He covered money and emerging trends in financial services and payments technology.

Mark has a bachelor’s degree in journalism from the University of Missouri at Columbia and attended Antioch College.

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