How Secure is Mobile Banking – and Can Biometrics Help?

August 11, 2022     |    5 minute read

How Secure is Mobile Banking – and Can Biometrics Help?

August 11, 2022     |    5 minute read

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FINANCIAL SERVICES

It’s hard to beat the convenience of “online.” Movies from the comfort of our recliners, sporting events with endless snacks nearby in the kitchen, or grocery selection and delivery without leaving our sofas – we now expect any and all things to be made available to us through any of our connected devices.

Banking is no different. It’s hard to beat the convenience of depositing checks, checking statements, and moving money anytime or anywhere we choose. The number of active online banking users worldwide is expected to grow to more than 2.5 billion by 2024, up from 2.1 billion today. What may be different about it is the seriousness of the matter. Earning money takes time and hard work; no one wants to risk losing it to a bad actor. Someone impersonating you to steal a food delivery is a much smaller problem than someone gaining access to your savings account. Reputable banks meet the challenge of customer protection with equal seriousness.

Banks continue to make strides in customer-facing and back-end areas to help keep customer assets secure in mobile banking. Most financial institutions plan to increase their security budget by 20-30% in 2022. But a key component of online banking that hasn’t kept pace with advancements in other areas is the consumer reliance on passwords.

What’s Wrong with Passwords for Mobile Banking Safety?

Chances are, you have a lot of passwords. In an age where everything from a refrigerator to a vacuum has an app or is somehow connected to the internet, you likely have, quite literally, hundreds of passwords. That number is getting higher, not lower. To cope, 51% of people use the same password for work and personal accounts. That is dangerous enough since a hacker could use a stolen or hacked password to access multiple accounts in that scenario. But remembering your passwords is likely becoming more difficult as well. To help counteract the vulnerability of easy-to-guess or easy-to-hack passwords and stay compliant under a host of regulations, banks have required the use of increasingly complex passwords. Which only fuels the use of matching passwords across a variety of sites on the consumer side. Or, if an individual does have a unique password across each account, they often struggle to maintain and remember each of them.

Fortunately, there’s a way out of this predicament for consumers and banks alike.

How Biometrics Can Help in Mobile Banking

Eliminating or reducing the reliance on passwords in mobile banking would streamline the customer experience while helping banks provide top-tier security and regulation compliance. By integrating biometrics into an authentication workflow, a bank can help lower the risk of identity fraud. Picture a hacker stealing one password and having access to a person’s bank records compared to a hacker that would need to present a selfie, a password, and voice authentication to access the same records. Biometrics uses a person’s physical characteristics – face, voice, fingerprint, etc. A person may mix up or forget their password, but their face remains their face.

Convenience is fantastic from the consumer perspective. But if a consumer doesn’t have the means to make it to a bank to open a new account, or if a bank doesn’t exist in their area, all the convenience in the world won’t matter. Banks can use biometrics as a standalone authentication method or a supplement to existing authentication processes. Biometrics makes it possible to open an account entirely online without the need to present identifying documents in person. Using biometrics gives customers more banking options and makes for a more cost-effective way for banks to reach new customers.

Does Biometrics Make Mobile Banking More Secure?

New and existing – customers likely are accustomed to using biometrics. 75% of millennials are already comfortable using biometrics to identify themselves. Even baby boomers have reported feeling that facial recognition is simple and convenient. Confidence in the authentication process is critical since reluctance to use biometrics would be a big hurdle for banks to overcome.

That comfort from consumers may come partly because they inherently understand that using biometrics in mobile banking helps keep their assets more secure. Security increases even further when banks combine biometric modalities in the authentication process.

By combining one biometric, like facial recognition, with a second modality, such as voice authentication, customers have peace of mind that their data is protected without the hassle of complicated passwords or the risk of over-reliance on something that a fraudster can more easily steal.

Beyond Mobile Banking – Biometrics in the Cloud

The implementation of biometrics has helped banks serve their customers in new ways. With biometrics, banks streamline the authentication process for their customers, provide greater security through a decreased reliance on passwords, and remove the need for new customers to travel to a physical location to open accounts. These are advantages that can apply to companies beyond financial institutions.

Biometrics in the cloud makes it possible for organizations of all types and sizes, not just banks, to make authentication conveniences available to their customers without building expensive authentication platforms. The same authentication processes bolstered in security by biometrics can improve the security for customers accessing their financial records at a bank or a nurse accessing health records in a hospital. Just as a customer can’t always travel to a bank to start a new account, a new employee can’t always travel to the corporate office to start a new job. The use cases might differ, but strong, reliable authentication can solve a variety of business problems.

While we all want the convenience of proving our identity easily (like scanning our finger), we don’t want to sacrifice security to get there. Using biometrics in mobile banking has shown us that we can have security and convenience. And as technology and the confidence in biometrics use continue to improve, those benefits are likely to spread to other areas. There may come a time when we don’t have to present ourselves or our identifiable documents in person. And as we learned from watching sporting events on our tablets, convenience is further improved by snacks.

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