In Response to Increasing Fraud Attacks, Consumer Education is Key

With an increase in fraud attacks targeting individuals, there has been a continued push for more comprehensive consumer education. Many financial institutions have introduced security centers in their mobile banking apps aimed at keeping customers informed about the latest threats.

However, according to Lea Nonninger, Digital Banking Analyst with Javelin Strategy & Research, while these measures are positive steps, they often fall short of providing sufficient protection. As detailed in her report on Security Centers in Digital Banking: How to Tell an Empowering Story of Prevention, Detection, and Resolution, many security centers still require significant improvements.

Shifting from Behind-the-Scenes Management to Customer Empowerment

Traditionally, financial institutions have taken a more passive approach by managing security issues behind the scenes. The reasoning was that constant updates about potential threats could be overwhelming for customers.

“Over the last five years, we’ve seen banks shift their narrative to focus on providing tools that empower the customer,” Nonninger stated. “Customers are often the weakest link themselves, and there’s a lot they can do to protect their accounts.”

As financial institutions recognize the integral role of consumers in security, they should now prioritize incorporating more education within these security centers. This approach could enhance customer confidence in identifying and addressing fraud, ultimately improving overall satisfaction with banking relationships.

While substantial progress has been made, creating a security center alone is not enough; it must be part of a broader fraud protection strategy. Nonninger emphasized the importance of empowering customers rather than just securing them, ensuring they feel confident and know what actions to take.

Evaluating Security Center Effectiveness

The Javelin report focused on three critical aspects: prevention, detection, and resolution. Analysis revealed that while many banks have security centers, the availability of comprehensive features is often lacking. This leads to a significant gap in actually helping customers detect and resolve fraud incidents.

“We found support for a holistic suite of features dropping significantly,” Nonninger noted. “Many security centers offer generalized information rather than detailed articles or interactive media that can have a real impact on users.”

Effective prevention requires staying updated on emerging attacks, such as phishing emails that mimic well-known brands or government agencies. Security center articles that inform readers about these hallmarks could significantly reduce the risk of fraud.

However, the study highlighted that security centers often lack relevant and interactive content, making it harder for customers to engage deeply with security measures. The information is frequently presented in a way that can discourage thorough engagement.

Enhancing Detection and Resolution

To improve fraud detection, consumers must understand how to monitor their accounts and transactions. Alerts play a crucial role by notifying customers of any unusual activity.

“Alerts are essential for staying on top of potential threats,” Nonninger observed. “However, many banks lack the digital features necessary for end-to-end fraud resolution.”

The report found that while fraud resolution tools were available in some institutions, they often fell short, leaving customers without a seamless way to address issues on their own.

Centralizing Educational Materials

Another opportunity for banks is centralizing educational materials across digital platforms. Nonninger stressed the importance of integrating security resources into the broader customer experience, ensuring that relevant information is easily accessible and effectively utilized.

“The goal should be to create a coherent story around security features without overwhelming customers,” she concluded. “Guide them through the necessary steps rather than just dumping all the information in one place.”

Despite these challenges, progress has been made in consumer education, with banks increasingly recognizing the need to empower their customers.