Digital disruption has demolished more than 50% of the Fortune 500 since 2000Technology is creating new online-only companies\u2014i.e., Kickstarter for funding, Sofi for lending and Venmo for payments. The digital disruption and, more important, its pace continues to disrupt long-established business models.\u00a0Incumbents, not wanting to become another cautionary tale of digital disruption, are making radical changes to their businesses to focus on online and mobile channels.Traditionally, businesses have operated in a world where customers validate their identity in person and transact using physical methods of payment such as cash, credit cards or checks. However, in a rapidly transforming business environment where new online channels are being used in new ways to engage with customers and partners, it is essential to establish an online model of trust that helps validate transactions and user identities in milliseconds with small amounts of information.Nobody wants to be in banking; everyone wants to be in fintechWhen is the last time you visited a bank branch? How did you deposit a check five years back, and how do you do it now? Millennials, loss of trust in big banks post 2008, and mobile access to previously unbanked and underbanked customers are driving the growth of a new class of fintech companies and legacy banks rapidly adopting digital channels.+ Also on Network World:\u00a0Businesses lack a streamlined approach to digital transformation +Not only retail banking, but areas such as international money transfers, lending, wealth management and property investment are being disrupted. The fintech and online banking disruption poses a challenge to traditional banking risk management processes from the physical banking world, such as verifying payment transactions, authenticating documents and validating identities of customers.Most Americans foresee death of cash in their lifetimeAlternative payments such as e-wallets, mobile and digital currencies, and person-to-person payment options play an increasingly prominent role in the payments space. For example, consumers are choosing to pay with their phone at retail stores. And during the 2016 holiday season, far more Americans shopped online than in-store over Black Friday weekend. E-commerce\u2014especially mobile devices\u2014is a significant driver of digital payment transactions.Digital and alternative payments present a great for opportunity for merchants to enable faster checkouts and reduce transaction cost. And they take the friction out of buying goods and services. However, the digital payment disruption poses a challenge to traditional payment processing in terms of the ability to manage multiple payment mechanisms and the ability to manage risk on all of them.Half of the items you order from Amazon aren\u2019t sold by AmazonHalf of all items sold on Amazon are from third-party sellers, small businesses and entrepreneurs. Look online, and you'll see everyone is selling, everyone is buying, and everything is for sale or hire or rent.Further, the sharing economy and online marketplaces are disrupting commerce and services. In New York, Uber outnumbers the iconic yellow cabs by a factor of 3 to 1. And Airbnb is now the most valuable accommodations company in the world.Online platforms are connecting buyers and sellers and shying away from holding inventory or owning assets. The sharing economy disruption poses a trust challenge when two strangers engage online to transact sometimes very personal and valuable assets like your car or your home.Whether you are an online marketplace, a digital mobile bank or a crowdfunding platform, every improvement in technology creates opportunities to disrupt your business. But every opportunity brings anxiety of managing risk associated with it. Fortunately, digital disruption\u2014more specifically advances in big data and machine learning\u2014has also helped vendors in the online fraud detection space make quantum leaps in developing tools for businesses to build trust in the digital world.We now have very sophisticated methods for user authentication and transaction verification that not only help reduce fraud, but they go a step further and develop fraud-sensitive flows to reduce friction to good users. When customers connect with your business, it\u2019s now possible to leverage technical advancements to your advantage\u2014detecting bad actors and stopping fraud in its tracks, while recognizing good customers and providing you with the opportunity to present them with the right item at the right time at the right price.