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Posted September 14, 2016
Financial Industry Cybercrime Study with First Annapolis Looks at Striking the Balance Between Convenience and Online Security
It’s the ultimate balancing act—and a lot is riding on it.
Whether you’re a financial services firm, or a partner serving clients in the banking sector, the success of your digital transformation efforts must include fraud prevention and fighting cybercrime without creating noticeable friction for consumers.
That’s the finding of an industry-first study we commissioned earlier this year with First Annapolis, a specialized management consulting and mergers and acquisitions advisory firm serving the global banking and financial services sector.
Our goal: to explore consumer perceptions of digital (online and mobile) banking and payments security, and to better understand the effects of current security measures on consumers’ relationships with their banks.
What are the tradeoffs? How much friction will consumers put up with to reduce fraud? Where’s the right place to strike that balance? And what is the penalty for failure?
A Run for the Money
While the industry strives to increase convenience for consumers in their digital banking experience, this should never be done in such a way that new paths are open for fraudsters to steal card data, gain access to bank accounts, or even open up new accounts using stolen identities.
But based on responses from nearly 3,100 consumers surveyed in the US, UK and Australia as part of this multi-market study, the mandate was as clear as it was divided.
Today, consumers rely on—in fact, expect—online and mobile channels to conduct everyday business in such a way that is convenient and perhaps superior to the traditional in-branch banking experience. As a result, banks face enormous pressure to invest in new ways to provide a streamlined, dynamic and engaging digital experience for customers. But it better not come at the expense of the kind of rock-solid security so central to consumer trust.
Four of our key findings from the First Annapolis research include:
Check Your Balances
So how’s all that for a balancing act?
Well, according to findings from the First Annapolis research, the price of failure can be steep: Just one year’s worth of fraud and friction is estimated to cost US banks $14.9 billion in lost relationship value.
This means it’s definitely worth taking some time to deep dive into the findings. You can download the full report here.
The success of your next digital transformation initiative might just hang in, well, the balance.