Banking customers hesitant to use mobile features due to security concerns

Banking customers are hesitant to use mobile features due to fraud and security concerns, according to Kaspersky Lab and IDC Financial Insights. Their findings show that of those not using mobile banking at all today (36 percent), 74 percent cited security as the major reason, which could slow the overall adoption of mobile banking services during a time where mobile device usage is exploding.

While security concerns are holding back non-mobile banking users from embracing the convenient, digital self-service solutions on the market, those who are active users of mobile banking today also share the same concerns. Of both, users and non-users of mobile banking, 85 percent said that they would increase their usage to “some extent” if there was more security and nearly half (44 percent) of those surveyed said that they would “significantly” increase their mobile banking usage with more security.

For financial organizations, an increase in self-service banking usage can drive revenue and reduce transactional costs, but currently customers don’t see a promising future for mobile banking in their lives – with 32 percent of respondents claiming that they do not ever foresee using mobile as the primary channel that they will engage with their bank or credit union. Banks that do not properly strengthen mobile financial security measures could miss out on a significant business opportunity and risk losing valuable customers in the process.

As financial institutions look for new ways to streamline adoption of self-service banking solutions, it is important that they proactively deploy and implement rigorous security solutions. In addition, banks should also reconsider their education strategies to ensure that customers understand the level of security in their mobile offerings. Survey Respondents want to see a proactive and informative approach to security from their banks with 80 percent indicating that they would like to see evidence of security measures being activated when they launch a mobile banking application.

“Consumers are concerned about security on their mobile devices, which has limited adoption of high margin mobile banking and payment activities including account opening, payments and transfers using a mobile phone.” Says Marc DeCastro, research director IDC Financial Insights. “As the next generation of online, mobile first and mobile only customers begin to explore digital banking choices, financial institutions that have and promote stronger security will attract and retain these customers more easily than those who do not.”

“As financial organizations continue to expand their self-service offerings to drive revenue and increase customer convenience, it’s important to proactively approach security technology for consumers’ mobile devices in the same way banks approach security for their own PC-based solutions, web offerings, and technology networks,” said Ross Hogan, Kaspersky Lab Global Head of Fraud Prevention.