FICO Survey Finds Strong Support for Digital Banking, Biometric Security

According to a new study from California-based analytics company FICO, nearly half (41 percent) of all North American consumers are now more likely to open a bank account using digital means, preferring it over visiting a branch in person to do so.

The information comes via FICO’s 2nd annual Consumer Digital Banking study, and highlights the growing trend of consumers in Canada and the US embracing digital banking and biometric identity proofing solutions as a result of the ongoing COVID-19 pandemic.

“In an effort to help stop the spread of the virus, consumers across North America have accelerated their move from brick-and-mortar branches to digital banking channels,” said Liz Lasher, Vice President, FICO.  “As a result, consumers’ expectations have shifted, placing higher priority on having a seamless and engaging digital experience, which includes establishing account security. For financial service providers, this means tomorrow’s success will rely on having the right platform to deliver enhanced customer experiences, improved fraud protection and financial crime compliance.”

The pandemic has placed a greater emphasis on consumers’ expectations of smooth and simple online experiences — including the process of identity proofing — when opening a new bank account, whether it’s at home on their computer or on a smartphone.

The study showed that a sizeable majority of Canadian respondents feel they should be able to authenticate their identity (70 percent), prove where they live (60 percent), and set up biometric authentication (45 percent) all via the digital channel or app they are using for their financial institution of choice. These numbers are slightly higher than those of their American counterparts, which are 62, 52, and 42 percent, respectively.

“Consumers embraced the digital first economy during the past 12 months, but how, when and what digital channels they prefer still varies greatly across demographics,” added Lasher. “For banks, it’s critical they understand their customers and deploy solutions and policies that can operate across channels and adapt to their customers evolving preferences.”

The issue of identity theft is another point of focus from the study, with results showing that 11 percent of American respondents believe they have already been victims of fraudsters using their identity to open an account, compared to six percent in Canada.

There is also evidence of the growth in acceptance of the use of biometrics for authentication and security purposes. Seventy-six percent of Americans and 74 percent of Canadians are willing to have their bank use some form of biometric authentication — facial recognition, fingerprint, voice etc. — to help protect them from fraud.

Nearly half of all respondents went so far as to reply that they expect their bank to use biometrics in some form as part of their login process.

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April 23, 2021 – by Tony Bitzionis