Putting security at the centre of customer service

On September 12 the UK’s Independent Commission on Banking (ICB) is due to make its final report. Most observers expect the Commission to recommend a much bigger differentiation between commercial/retail banking on one hand, and investment banking on the other. That will put “banking” back in the dock and trigger another round of debate, complaint and hand-wringing about what has (or has not) been done since the financial crisis broke in 2007.

All of which should put building customer trust right back at the top of bankers’ To Do lists – how to create it and how to keep it. And in that context, surely UK banking’s top management should pencil in security as one of the ways that they can build that trust. After all, they can’t influence the outcome of the ICB’s report, but they can take concrete steps to show customers that they are putting customer service right at the top of their own agendas.

Security has a big role to play here. Fraud costs banks money –  in its second Annual Fraud Indicator, the NFA estimates fraud is costing the UK over £38 billion a year, and that online banking has seen an increase of 14% (total of £60 million) – but there is also the harder to quantify, but probably much larger, cost in terms of damaged customer relations. The recent report by UK consumer group Which? showed Nationwide as top of the pack for online security, but the building society still only managed a score of 69%.

Banks have an opportunity to cut fraud without blocking customers using their cards or accessing their accounts as they are in turn all too likely to make those customers put the offending card at the back of their wallet, or to switch bank provider. And with providers like publicity-hungry Metro Bank bidding for current account business, the established High Street players can’t simply rely on business as usual practices to keep retail customers on side.

Security won’t (and probably shouldn’t) be the main pitch to customers, but it can (and should) underpin banks’ core need to improve the customer experience, and start the long climb up the hill to positive brand ratings.