Cyber security is affecting customer experience in banks
Latest figures from Collinson Group highlight the pressure banks are under to deliver better, more personalised experiences to their customers.
83% of UK consumers currently feel their bank does not know or understand them and less than a third (27%) feel they receive a high level of personal service.
While a number of issues exist that prevent incumbents in the sector from being able to rapidly improve the experience in line with these increasing customer expectations, IBM’s senior product marketing manager, Eileen Turner, states there is one issue in particular that is proving particularly restrictive but is often not documented in relation to experience.
“Cyberattacks are becoming more sophisticated and even harder to detect and prevent. For example, cybercriminals are increasing the number of attacks they launch directly from legitimate user devices to bypass sophisticated device ID solutions.
“Today’s cybercriminal have an extensive list of tools to obtain everything from passwords to secret questions, token-generated passwords and even bypass two-factor authentication (2FA).
“In response to new cyberthreats, financial institutions are implementing more controls in hopes of mitigating current and future threats. In some cases, these controls do reduce risks associated with advancing attacks. However, they often degrade the customers’ experience by creating additional barriers. In the rush to improve online protection, most financial institutions simply accept the perceived necessity of negatively affecting the customer experience.”
Last year it was reported that banks around the globe were having to “fend off” multiple cyberattacks every single day, and 2014 witnessed a number of high-level data breaches as a result, including 76m households and 7m small businesses having data stolen in an attack on US bank, JP Morgan, and a group hack of more than 100 banks across 30 countries which resulted in up to $1bn dollars being stolen.
However, Turner believes the issues surrounding security should not be at the expense of the experience any brand, bank or otherwise, is able to offer, and is something that needs addressing.
“It is clear that the financial services industry needs a better approach for fraud prevention. The current approach does not support the industry’s goal of a superior customer experience. Given the fact that most banks compete on customer experience, it’s all the more critical that the online experience is not negatively impacted.”
She suggests banks need to focus more attention on how fraud attempts are allowed to manifest in the first place, because once they begin, the effort required to resolve them often resonates through to the customer.
“Blocking fraud from entering the system is the most effective means of preventing it. If fraud is never initiated, customers will not be inconvenienced by blocked transactions, stepped-up authentication and phone calls for verification. In addition, the bank’s staff will not have to investigate fraud alerts and respond to customers’ inquiries regarding fraudulent transactions.
“Security and customer experience goals and outcomes can be aligned when effective fraud prevention technologies are utilized. There is no longer a trade-off between strong security and customer experience and operation costs. Strong, effective security can and should enhance customers’ experience across all channels.”
A recent book by Adaptive Lab’s James Haycock and former Daily Telegraph technology editor, Shane Richmond states the combination of factors currently hampering customer experience in banks was something that incumbents may struggle to ever get to grips with, and that many should look to ‘beta banks’ as an alternative.
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Chris is Editor of MyCustomer. He is a practiced editor, having worked as a copywriter for creative agency, Stranger Collective from 2009 to 2011 and subsequently as a journalist covering technology, marketing and customer service from 2011-2014 as editor of Business Cloud News. He joined MyCustomer in 2014.