With the onset of COVID-19, recent reports show that buying patterns experienced decades of change in just a few short months. Add electronic payment regulations requiring multi-factor authentication such as PSD2-SCA and 3DS2 into the mix and the need for a frictionless user experience (UX), and oftentimes financial organizations don’t even know where to begin. Here we’ll explain avoiding the price of poor payments and customer satisfaction and safety.
How can banks and payment providers get started to more securely and more easily authenticate their users while accelerating their digital transformation strategies? Decades of experience have taught us that this all boils down to balancing security and convenience. By placing an equal emphasis on both strong authentication protocols and a seamless user experience, organizations will be able to build up their security postures while simultaneously maintaining higher customer satisfaction and safety.
So what exactly does this look like, and how do they get started?
In order to satisfy the security side of the coin, banks and payment providers must embrace the shift to passwordless authentication. Eliminating hard-to-manage (and hard-to-remember) passwords mitigates the potential of fraud, identity theft and even scalable password attacks like the recent Verkada breach , where hackers used login credentials to obtain access to 150,000 live surveillance cameras.
Layered security approach
To successfully ditch passwords and modernize their security posture, financial organizations should consider deploying multifactor authentication (MFA). Put simply, multifactor authentication requires two of the following three things: something you have, something you know, or something you are. The approach not only allows for customer satisfaction and safety, but allows banks and payment providers to deploy authenticators like biometric modalities (i.e., face, iris, fingerprint) to enable MFA for users hoping to access their banking information, make online transactions and more.
To most effectively transition to passwordless authentication, these organizations should follow guidelines from the FIDO Alliance. FIDO is an organization formed to address the lack of interoperability among strong authentication devices, as well as the problems users face with creating and remembering multiple usernames and passwords. After all, the core ideas driving the FIDO Alliance are ease of use, privacy and security, and standardization.
Once authentication is modernized and more secure, financial organizations must also ensure they’re addressing the other side of the coin: user demands for a frictionless experience. After all, the most secure application or website means nothing if no customers want to use it. In fact, research finds customer experience will soon overtake price and product as the key brand differentiator. This means security and CX must share the center stage for organizations to truly succeed.
Lucky for organizations who have already made the shift to passwordless, this transformation tends to come hand in hand with a frictionless user experience. The user simply provides their biometric modality, which interacts with their device and the cloud through private/public key encryption, to deliver quick yet secure authentication for all of their transactional needs. In other words, by leveraging biometrics, consumers have nothing to remember, nothing to forget and nothing to manage. With millennials spending a whopping 38 hours per year taking selfies alone, the mode of authentication proves pretty convenient for accessing their information and making transactions. Furthermore, with COVID-19 causing all age groups to become more familiar with digital technology, this trend is likely to accelerate quickly.
By eliminating friction across customer engagement points, organizations ultimately make the users’ lives easier, increasing their overall satisfaction and brand loyalty. In turn, this positively impacts the organizations’ bottom line. Makes you really consider the overall impact of swapping that outdated password, huh?
Customer satisfaction and safety
Through embracing a balance of strong passwordless security and seamless user experience, banks and payment providers will be able to protect their customers and increase brand loyalty, and ultimately strengthening their business to become more resilient through whatever is next to come. Let’s just hope it’s not another 2020. Here’s to keeping customer satisfaction and safety top of mind.