Mobile Banking’s Authentication Breakthrough

Anti-fraud efforts can seem like word salad with exotic ingredients being tossed around: strong consumer authentication (SCA), two-factor authentication (2FA), the second Payment Services Directive (PSD2) … you get the idea. Ask consumers what they want, however, and the acronyms vanish like a metaphor for things that vanish. Turns out consumers mostly want one thing from mobile banking apps: control.

In the new PYMNTS Consumer-Centric Authentication Playbook: Taking (Authentication) Control, we asked nearly 3,000 U.S. banking customers about what makes (or breaks) a mobile banking CX. What they said may surprise FinTech insurgents and orthodox bankers, because what they want is simple: more digital sway when it comes to their own money.

Control vs. Chaos?

With demographics and technology catching up to each other, it’s not a question of explaining what an app is, but rather what you can do with it. Consumers are downloading banking apps in record numbers, but they’re not always blown away by what they’re getting.

That’s a painful disconnect for a connected economy (like the one we’re in now). Happily, the good news outweighs the bad, as consumers are providing all the clues needed to create a satisfactory mobile banking experience. For example, over 28 percent of respondents said they would use their banking app more often and to do more things if it gave them the ability to accept or deny certain transactions as they are presented for payment. Many respondents feel that their bank app is actually a bit of a liability, saying that if they had more control over authentication at their smartphone fingertips, they would experience less fraud. Ouch.

There are some things bank customers would like their apps to do that aren’t purely about control. Over 33 percent of respondents want their financial institutions (FI) to accept liability for fraudulent app transactions, and nearly 21 percent said bank apps need to be faster. A smaller but very meaningful cohort (17.2 percent) think bank apps should be easier to use. Fair enough.

Six Sides of the Bank App Persona

Considering that about 55 percent of all respondents (and over 60 percent of high-spending bridge millennials) said they would transact more if mobile banking apps simply offered finer controls, one might wonder what’s taking the banks so long to grant their wish.

For one thing, at least six distinct consumer personas have evolved around mobile banking –from “infrequent users with little control” up to “frequent users with full control.” The report shows a detailed table mapping out the six personas and the in-app banking services they want (or don’t want), ranked highest to lowest in terms of utility and added value.

A huge takeaway from the PYMNTS Consumer-Centric Authentication Playbook: Taking (Authentication) Control edition is that consumers would use banking apps more (in some cases much more) if their concerns around transaction control and security were addressed. FIs that do this quickly — and well — may be rewarded with an influx of app-happy new account holders.