Banks’ Digital Offerings Walk a Fine Line Between Trust and Seamlessness

Roughly 70% of consumers have extremely or very high levels of trust in their financial institutions (FIs), which may lead one to wonder what’s going on with the other 30%.

In an interview with PYMNTS, Mzukisi Rusi, vice president of solutions at Entersekt, said that at least some of the 30% have had less-than-optimal experience with data security or know someone who has — and they may have come up against online banking journeys that were full of friction.

“FIs will have to continue giving confidence to consumers that their data is safe and that they always will take a proactive approach when it comes to fraud prevention,” Rusi said.

But they must also put the user experience (UX) at the forefront, particularly as the great digital shift brings so much of financial life online.

“Although you hear consumers saying that they love high security, they are also not keen on that security being full of friction,” he said.

In the bid to improve security, many FIs have undertaken the heavy lifting required to boost their digital platforms’ safety, he said.

Regulation — and Trust

Banking is one of the most regulated industries. Mandates such as the European Union’s revised Payment Services Directive (PSD2), which requires FIs to adhere to strong customer authentication (SCA) protocols, can do much to cement that trust. Increasingly, one-time passwords and other authentication tools are also being abandoned in favor of more high-tech, comprehensive approaches.

FIs, Rusi said, “have to be nimble to respond to regulation.”

There are already differences in how consumers interact with different digital channels. In some cases, FIs are struggling to implement omnichannel or cross-channel efforts, often because they’ve done so by procuring and deploying multiple solutions from several vendors.

Those capabilities are not consolidated and don’t speak well to each other — and they wind up having negative ripple effects on the front-facing consumer activities, Rusi said.

He offered up the scenario where, as encountered in a mobile app, any number of (financial and non-financial) online experiences can be optimized, aided by biometrics.

“But as soon as an individual switches over to online banking, which is browser-based, it’s a different experience,” he said. That’s where FIs run the risk of losing at least some consumer favor, as the UX is inconsistent.

In order to eliminate those inefficiencies, FIs should seek out solution providers that have thought about — and have designed — security solutions that can enable those capabilities with one minimal integration, he said.

FinTechs and digital upstarts that are bringing new payment options and financial products to the forefront have been able to grow quickly, supported by a slick UX, great product features and streamlined user journeys. Those digital-only providers must be able to deliver the same level of security that banks do — and they don’t necessarily have the experience or tools to do so.

Traditional providers and the newer, digital FinTechs will continue to evolve in symbiosis, Rusi said.

He added that the payment methods that are embedded within these FinTech apps actually belong to the bank.  For the FIs, then, there’s a balancing act — a tightrope that must be walked between maintaining the bond of trust and promoting a seamless online experience. Relationships of mutual benefit can be forged.

“The two worlds have to get to a point where they can work together to create great user experiences — but assure consumers that their data will be protected,” Rusi said.