Snippet: Consumers’ preferences are undeniably shifting digitally when it comes to banking and financial services. According to a recent study by Citibank, 31 percent of consumers use their mobile banking app more than any other — placing mobile banking behind only social media and weather for the most frequented mobile destinations.

This article was originally published in PYMNTS.com on 4 April. In it, Jennifer Singh, Entersekt’s director of channel partnerships discusses how consumers’ digital migration to mobile banking has given banks and other financial institutions a tremendous opportunity to unlock a host of experiences across channels.

Consumers’ preferences are undeniably shifting digitally when it comes to banking and financial services. According to a recent study by Citibank, 31 percent of consumers use their mobile banking app more than any other — placing mobile banking behind only social media and weather for the most frequented mobile destinations. And by all accounts, this digital migration is driven by consumer preference — according to the same study, 91 percent of mobile banking users prefer accessing their app over going to a physical branch, and 68 percent of mobile banking millennials believe their smartphones will eventually replace their physical wallet.

This means banks and other financial institutions have a tremendous opportunity to leverage the mobile device, that is literally always at the majority of customers’ fingertips, as the “fulcrum of trust” to unlock a host of experiences across channels. Consumers are certainly digitizing their behavior, but only 3 percent are actually digital-only customers.

That means building an omnichannel strategy is crucial for banks. The recent winners we have been seeing in the space have won because of seamless functionality and well-executed user experiences. In some cases, the banks have not really kept pace, but they do have an opportunity to really drive share of wallet through the mobile banking app.

To start capitalizing on those opportunities, banks can focus on building from their strengths, specifically the relationship of trust they have with their customers.

The unique relationship

Banks are uniquely trusted by consumers, and this is a statement backed up continuously by data. The Citibank study referenced above, for example, found 87 percent of Americans would still trust traditional banks more than non-bank financial institutions. And those relationships are an excellent starting ground for succeeding with innovations where other technology platform have recently failed.

There are challenges there: banks serve widely ranging demographics, some of which are more digitally native and savvy than others. But on the whole, banks can greatly help their efforts in building and leveraging that trust simply by making what they do more transparent to their customers when it comes to security.

Banks need to expose more of their security aspects to consumers, so they can see them in action. They also need to empower their customers with education on things like how they can use their mobile devices, and things like biometrics and geolocation, to provide extra layers of security across banking channels.

Banks also don’t need to be afraid of introducing a little friction — as long as it is of the friendly variety. A seamless experience is important, but a healthy level of friction puts more control in the hands of the consumer, which further establishes trust. When Entersekt did a study on this last year, it came back that 90 percent of customers preferred to have the ability to approve a mobile transaction before it was completed through their banking app, even if it added a little extra step.

We are in an era where data can be found very easily on a customer because of all the breaches, so it is no longer secure to just have a username and password-based system, or even a set of knowledge-based data to answer questions with. Instead, we need to give a little more control back to the user, so they have the ability to see and approve the transactions they are making.

And from that platform, banks can more fully open up the possibilities for a seamless experience for users.

Bringing the bank back to the center of commercial life

There are changes big and basic coming in the era of secured multi-channel banking. The next few years could completely change how consumers interact with their banks. There’s the small stuff, like the ability to send PIN codes to customers digitally instead of via the mail, so they can use a newly digitally provisioned ATM card right away when they have to replace a card. It might mean incorporating innovative payment experiences like Zelle directly into their mobile offerings.

But, there are other things they can do to really extend their position of trust to be at the center of a third-party loyalty ecosystem as well. This might involve being able to place an order at Starbucks or another retailer directly from a banking app instead of having to use a phone. Or creating a space in which customers can log in with their mobile banking app in stores and collect digital offers or coupons. The options are many — and the banks’ unique set of channels to operate over, and their relationship of trust with consumers, give them a unique leg-up in the race if they can properly leverage those things.

The bank’s omnichannel capabilities are a strong competitive advantage if they are used properly because they give consumers multiple ways to engage with a bank, whereas pure tech platforms really can’t offer all those channels. It is a core advantage that is often overlooked and underutilized.

If you enjoyed this article, you may enjoy this one, in which our chief commercial officer, Dewald Nolte, discusses the problems and opportunities surrounding digital payments.

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Jennifer Singh

DIRECTOR, CHANNEL PARTNERSHIPS: NORTH AMERICA

From strategy to execution, Jen makes innovative ideas become scalable businesses. Before joining Entersekt, Jen helped found the Digital Identity Solutions group at Thomson Reuters, an incubated business venture focused on the development of new identity verification and authentication services. Jen also volunteers as the City Director of House of Genius Atlanta, a community that helps entrepreneurs overcome challenges.

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Entersekt is an innovator of customer-centric fintech solutions. Financial services providers and other enterprises rely on our patented mobile identity system to provide both security and the best in convenient new digital experiences to their customers, irrespective of the service channel. With us, they can concentrate on their innovation roadmap, while delivering intuitive, low-friction digital experiences to their customers.