Lime kicks fraud to the curb with Twilio Verify

Challenge

As it expanded its global reach, fraudsters began targeting Lime’s SMS-based two-factor authentication (2FA) process to artificially inflate traffic. Lime’s number one priority was mitigating such fraud known as SMS pumping fraud.

Solution

With Twilio Verify Fraud Guard, Lime can verify new user sign-ups—their biggest source of fraud—and improve the overall security of their platform for their riders and business.

In the world of micromobility, safety and security are paramount for both riders and operators. Lime, the world’s largest shared e-bike and e-scooter vehicle company, understands this all too well. 

Lime designs its own vehicles for riders in more than 280 cities across nearly 30 countries. The company is obsessed about rider experience, ensuring its electric vehicles are in good condition so people can get where they need to go safely. 

“Safety and reliability are a big part of ensuring riders have a good experience getting from point A to point B without too many hiccups,” said Gabriel Boorse, a senior software engineer at Lime. “From a technological perspective, that means that the app is working and they're able to complete the functions that they need to without too many hindrances.”

With operations spanning across the globe, Lime eventually encountered challenges in combating SMS pumping fraud. To address this issue—and enhance the overall rider experience—Lime turned to Twilio Verify’s Fraud Guard feature to transform their fraud mitigation strategies and improve the security of their platform.

Lime’s SMS pumping fraud warning signs

As Lime expanded its global reach, the brand recognized the escalating risks of SMS pumping fraud. Fraudsters in high-risk regions were targeting Lime’s SMS-based two-factor authentication (2FA) process to inflate traffic and creating additional SMS costs for Lime as a result.

For example, Lime had been seeing a significant daily volume of SMS fraud in Jersey, the island off the English Channel. “We had seen more fraud there than the entire population of that island,” said Boorse. “That was a really strong signal that something fraudulent was going on. We also saw significant outsized numbers of SMS being sent in Cyprus and Romania that were likely fraudulent as well.”

With fraudsters constantly evolving their techniques, Lime urgently needed a reliable and scalable solution to address these mounting challenges and bolster account security.

A more secure Lime rider authentication experience

Lime had originally planned to build and ship in-house a custom solution to combat fraud and enhance account security. “Lime had a lot of internal solutions for mitigating SMS pumping fraud like rate limiting and blocking specific blocks of numbers,” said Boorse.  But after a couple of discussions among Lime’s payment and trust team, they decided to give Twilio Verify a try.

Lime ran a pilot in early January 2023 and went through the process of putting together an internal design document, implementing the integration, and evaluating the results. Lime was already using Twilio Programmable Messaging for phone number sign-ups, so they underwent a percentage rollout where they slowly fed more and more traffic into Twilio Verify. 

“We saw that Verify Fraud Guard at the time was doing a better job of blocking spikes in SMS fraud than our own measures, and that's what helped us make the decision to turn it on,” said Boorse. Lime eventually rolled out Twilio Verify across all accounts by February of 2023 after about four weeks of engineering work.

Twilio's extensive security expertise, robust infrastructure, and user-friendly platform made it the ideal choice. With Verify Fraud Guard in place, Lime could easily integrate a variety of risk assessment and mitigation strategies to combat fraud effectively, without compromising user experience or security.

Twilio Verify Fraud Guard's ability to assess risks in real-time and apply appropriate authentication mechanisms was particularly appealing to Lime. Fraud Guard’s protection modes allowed Lime to enable the Max Protection Mode and use the 100% guarantee against SMS Pumping fraud. This allowed Lime to strike the right balance between strong security and a smooth onboarding process, ensuring that users could start their rides without any unnecessary friction or delays.

Lime is now using Twilio Verify globally. So anytime someone signs up for a new Lime account with a phone number and they provide a one-time password, they’re going through Twilio Verify.

Optimizing fraud prevention while increasing savings

Twilio Verify’s Fraud Guard provides Lime with valuable insights into fraud patterns, enabling their fraud prevention team to continuously refine and optimize their strategies. This proactiveness ensures that Lime stays ahead of the curve and can adapt quickly to evolving fraud threats, further strengthening the security of their platform and protecting user accounts from malicious activities.

“Ultimately there's an opportunity cost with fraud,” said Boorse. “If somebody is abusing our platform, they could fraudulently rent a vehicle that might otherwise be needed by an actual rider, reducing the reliability of our service. We're obsessed with creating the best rider experience possible, and that includes preventing fraud.”

Verify also helped remove bad quality conversions from their SMS accounts, allowing for conversion rates that were of better quality. Additionally, Verify allowed Lime to:

• Drive more efficient account management
• Improve deliverability of SMS messages
• Ensure genuine phone number management
• Meet regulatory requirements with Sender IDs

“We don't have to worry about managing our own number pools and keeping up with regulatory issues to make sure we're using the right numbers all the time,” said Boorse. “Verify ensures it’s all there.”

Riding into the sunset with Twilio and Lime

By delving into these future implementations, Lime aims to unlock a world of possibilities in fraud prevention, user experience enhancement, and business growth. The collaborative efforts with Twilio empower Lime to capitalize on the latest advancements in communication technologies, enabling the realization of its vision as a premier micromobility service provider.