Identity theft and other fraudulent activities are a continual threat to anyone transacting over the Internet, even more so in the era of the smartphone when many consumers are now using their phones as the primary channel to access and manage their finances.
A new report released by Telstra - 'Mobile Identity – The Fusion of Financial Services, Mobile and Identity' – highlights the fact that Australian consumers using mobile banking applications now want their mobile devices to instantly recognise them via biometrics, such as fingerprint and voiceprint, instead of having to prove who they are with passwords and usernames.
Gen X and Gen Y are the ones increasingly using their smartphones as the primary channel for accessing and managing their finances.
“Since its advent, the smartphone has become the primary device for Australian consumers to access financial services. We want to be able to access our financial services anywhere, pay using our phones and acquire new financial products at any time. This has led to a behavioural state we are calling ‘no-finapp-phobia’ – the fear of being without financial applications,” said Rocky Scopelliti, Global Industry Executive for Banking, Finance & Insurance, Telstra.
The Telstra report discusses how Australian institutions must relate to identity in different ways to address changing lifestyles and stages, and Scopelliti says this will help financial service providers personalise trust among customers “enabling them to better acquire and retain users, especially among Gen X and Gen Y, who are the primary users of mobile applications”.
“Security of finances and personal information, and the institutions reputation on security, are now the most important factors for consumers when deciding their financial institution, with over half suggesting this is critical for them.
“As consumers become more sophisticated users of mobile financial applications, acquiring products and services, it means they expect more sophisticated security – of which a third of those surveyed would be willing to pay for on average at $17 per annum.
“As financial institutions are more trusted than other organisation types, the fusion of financial services, mobility and identity offers the industry an opportunity to lead the creation of the Internet of Trust – assuring consumers and businesses that their finances and personal information are safe and secure. These benefits, however, can only be realised through new models of collaboration within the broader digital mobile ecosystem.”
According to the Telstra research, in Australia, ING Direct and BankWest customers are the most satisfied with the identity and authentication methods offered and are the most likely to recommend them.
The report found that under half of Australian consumers are ‘very satisfied’ with their institutions authentication methods, with consumers no longer believing in the safety of passwords, instead trusting options such as biometrics (voice, fingerprint, iris and facial) and second factor authentication far more.
In fact, four in five Australian consumers would feel more secure and believe mobile identity would result in less threat of fraud, Telstra reports.
“Banking has always been a high trust proposition. Now that we have moved into a digital first world, we need to re-think the password with biometrics now the preferred method of being identified,” Scopelliti says.
“With our consumption of financial services intrinsically linked with the mobile device, our mobile identity is the key to unlock trust with our service provider.”
According to Scopelliti, for ‘no-finapp-phobic’ Gen X and Gen Y consumers it’s time to create “mobile identity solutions that instantly recognise them for who they are. The good news is that consumers are ready to travel on the journey with their financial institutions.”
For more information on Telstra’s Mobile Identity – The Fusion of Financial Services, Mobile and Identity whitepaper click here.