balancing fraud & customer experience in a mobile world

© 2014 All Rights Reserved. Javelin Strategy & Research, a Greenwich Associates LLC Company

Balancing Fraud and Customer Experience in a Mobile World

November 18th, 2014

Thelton McMillian CEO & Founder

Comrade

Al Pascual Director of Fraud & Security Javelin Strategy & Research


Can I get the Slide Deck and Webinar Playback?

Yes, of course!

Webinar is being Recorded.

An email link will be sent tomorrow.

The slide deck is available from Comrade.

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Today’s Agenda

I. Introduction

II. Common UX Threat to Security

III. The Relationship Between UX and Trust

IV. Reinforcing Security – Brand & Design

V. Improving Identification & Authentication

VI. Customer Defined Controls

VII. The Role of Education

VIII. Recommendations

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Today’s Presenters


Email: [email protected] Twitter: @MindofAlPascual

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Thelton McMillian Founder & CEO

Comrade Email: [email protected]

Twitter: @comradethelton

The Relationship Between UX and Trust

A brand must generate the trust necessary for users to engage.

To them, the bank is where their relationship is and when that experience seems inconsistent it can lead to mistrust.

Banks that rely on multiple backend systems for payments, commercial services, small business banking, and lending are commonly guilty of providing an inconsistent experience.

Customers expect a trustworthy and seamless experience from their bank similar to that of Amazon, Apple, Uber, et al.

Reinforcing Security with Brand & Design

How to reinforce security with branding & design

• Domains & subdomains that consistently reflect the bank brand

• Single sign-on across web properties

• A unified look-and-feel across platforms (multiple websites)

• A consistent navigation structure that spans multiple platforms

• Content and design that reinforce a “trust”, “security” message

How not to do it

• Abdicate control of your user experience to third-parties

• Approach security and fraud prevention as a check-box

• Develop multiple mobile apps


Balancing Experience and Fraud

Quick Balance Improves Convenience Without New Risk

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Updating the CIP Process for Digital Opening

Traditional - Cumbersome identity validation

process, which includes the manual entry of PII on the part of the prospective customer (especially so on a mobile device).

Improved - Use of a webcam or mobile device

camera to capture information from identity documents, validate those documents, and to perform facial recognition (e.g., Facebanx, Jumio, etc.).

Digital Account Opening CIP Process:

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88.5 Million Consumers Applied for a Variety of Accounts Online or Through Their Mobile Device

Percent of Consumers Who Applied to Open Accounts in Past 12 Months

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8%

13%

18%

2%

3%

3%

0% 5% 10% 15% 20% 25%

Auto Loan

Checking

Credit Card

Online

Mobile


Improving Authentication Through Design

User Authentication Process:

Traditional - Authentication that relies on static

user credentials, supplemented with knowledge-based authentication for step-up, interrupting the experience by adding friction and contributing to theft/misuse.

Improved – Use of biometrics delivered through

mobile devices to create a low-friction, consistent experience across financial interactions (e.g., account login, payments, etc.).

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Apple’s Touch ID is a Prime Example of a Balanced Experience

Mobile wallet adoption has been hamstrung by a POS experience that was often less convenient than traditional forms of payment . Apple Pay w/Touch ID reduced the number of steps in a mobile wallet POS payment, while at the same time introducing strong authentication.

Image courtesy of:

http://www.apple.com/apple-pay/







Fingerprint Biometrics Most Likely to Increase Online Banking Frequency with Other Modalities Close Behind

Consumer Propensity to Change Online Banking Behavior Due to Authentication

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11%

12%

12%

13%

17%

0% 5% 10% 15% 20%

Voice biometrics

Facial recognitionbiometrics

Eye biometrics

Account username andpassword

Fingerprint biometrics

Increase in frequency


Leveraging Customer Defined Controls

Banks spend a great deal of time and energy building behavioral models to spot anomalous, potentially fraudulent activities, yet these models are never 100% accurate. By deputizing the customer to answer a few questions about their projected use of account features and transaction types, banks can disable the activities customers don’t plan to use. This transitions declines from a top-of-wallet concern to a relationship building experience.

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Image courtesy of:

http://www.ondotsystems.com/




Mobile Business Credit Card Control

KAAYASOFT Examples of account management and fraud control capabilities: 1. Businesses can set

controls for individual card holders

2. Rules include time,

category, location, budget

3. Built-in messaging

enables efficient workflow and approvals

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Customer Defined Controls are Generally Unavailable Among the Top 50 Financial Institutions

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1 in 50 examined banks provide customer defined controls


The Role of Education: The Security Center

An FI’s “security center” should be readily accessible: 1. From the initial page

of an online site 2. Via the mobile app To be an effective educational tool while also bolstering the FI’s security image.

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Image courtesy of: https://www.unionbank.com/

https://www.unionbank.com/

https://www.unionbank.com/


Mobile Security Education and Messaging

Tap-to-play fraud prevention tips, immediately available video within mobile banking app

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Bank of The West: Fraud Protection Video


Online and Offline Safety Education is Popular, but Opportunities for Improvement Abound

Adoption Rates of Security Education Among Top 50 FIs

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48%

64%

92%

0% 20% 40% 60% 80% 100%

Phishing, Vishing, and SMShingeducation

Mobile safety education

General education about online andoffline safety


Recommendations

1. Deliver a consistent brand and design experience

2. Adopt accurate, low-friction authentication

3. Enhance the account opening process by replacing manual CIP data collection with automated processes and biometrics

4. Empower consumers and reduce fraud through customer defined controls

5. Keep educational material current and at the forefront

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Thank You!


Email: [email protected] Twitter: @MindofAlPascual

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Thelton McMillian Founder & CEO

Comrade Email: [email protected]

Twitter: @comradethelton

balancing fraud & customer experience in a mobile world

Design

security brand design

reinforcing security

security message

customer experience

inconsistent experience

seamless experience

user experience

parties approach security