Over the past few years, there has been an increased adoption of mobile channels for remote banking, particularly during COVID-19. In fact, a recent Mastercard survey asked 14,000 global consumers how the pandemic affected their banking habits. Of these consumers, 96% of respondents completed banking tasks digitally, 53% engaged with mobile banking apps more than they did pre-pandemic, and 87% of those that hadn’t used apps previously would continue to do so.
The mobile channel has become the supreme interface for banking, offering on-the-go users the ability to check their balance, send payments and pay bills at their convenience. Banks and credit unions are racing to provide online options for services that were traditionally done in person, such as loans and account openings. However, for credit unions to use mobile banking as a competitive advantage, they must balance convenience with security. Convenience is key for mobile app success, reducing friction and encouraging members to remain loyal to their credit unions. If members are forced to wait for services, there is a risk that they might find another financial services provider that gives them the convenience they desire.
One of the biggest remaining roadblocks to enabling digital banking is the concern over mobile app security. The FBI recently warned that with the increased use of mobile apps, there is a greater risk of cyber-attacks as hackers learn how to crack app security to gain access to mobile users’ personally identifiable information and banking credentials. To combat this, credit unions must ensure these apps have sophisticated, robust security processes in place so it is more difficult for hackers to target and exploit their apps.
Fortunately, credit unions can take simple steps to reduce the risk of fraud, and prevent account takeover and other attacks to better protect both their members and themselves. To stay ahead of the curve in mobile banking and ensure high adoption, credit unions need to strike the right balance between security, convenience and all-around user experience.
Create a Good User Experience
For credit unions, user satisfaction is key for member loyalty. One way they can retain their user satisfaction is to prioritize the member experience and convenience. On average, users have about 40 to 60 apps on their phone. Credit unions need to ensure that their applications have a streamlined user experience, so users can easily and quickly take advantage of online services and continue to use mobile apps for their everyday banking processes.
But how can credit unions create a good user experience? First, they must create a convenient login process. Users do not want a cumbersome login system, such as a username and password or SMS authentication, where they need to wait for a text message to enter in a one-time password. Additionally, alternative authentication methods such as biometrics can protect users against cyber threats posed by the growing number of leaked consumer passwords. According to FICO, 51% of banks are hardening authentication with biometrics. Apps should utilize biometric authentication technology for users’ login credentials. Biometrics is meant for one person, whereas with SMS codes, there is not a guarantee that just one person received the code. For example, malware can automate the interception of SMS messages and relay them along to attackers.
Next, credit unions should make interfaces consistent across mobile and web channels. Every available process, such as travel alerts or transaction history, needs to be in the same place on both the web and mobile app, so that it is easy to find as well as easy to switch between channels. This consistency will eliminate confusion about functions and reduce frustration as users learn how to interact with the application’s interface.
Best Practices for Bolstering Mobile App Security
Though it’s important for credit unions to improve experiences to retain members, this cannot be done without boosting security. Proper security to enable mobile and digital services gives credit unions a competitive edge, and gives users peace of mind that their personal information will be protected as they use these applications. Credit unions can help bolster their mobile app security by following best practices, including mobile app shielding and secure app development.
Mobile app shielding can protect against threats, such as fraud or account takeover (ATO) attacks. This advanced mobile app security provides a multi-layered defense approach and monitors for threats while staying out of the user’s way – unless there is a security issue or threat that requires security administrators to intervene and respond.
Credit unions should also consider their app development process. Regardless of whether credit unions develop apps in-house or through third-party vendors, they should still utilize mobile app shielding. In addition, if utilizing outside vendors, they should always ask for certification or penetration test reports, which show that they’ve taken proper care in securing the app. This is critical for credit unions, because if a security issue were to occur, it would more likely affect the reputation of the financial institution, rather than that of the vendor.
In 2020, consumers used mobile financial services more than ever before, and their digital banking habits are here to stay. Though credit unions don’t necessarily have the resources that banks do, there are still a variety of ways for them to ensure mobile app success. Credit unions should create an optimal user experience, enable biometric authentication and implement robust security processes like mobile app shielding. By following these important security guidelines, they can enhance their mobile apps, balancing user protection while offering members an optimal digital banking experience.
Sam Bakken Senior Product Marketing Manager OneSpan Chicago