FICO Survey: UK Consumers Could Thwart Strong Customer Authentication

FICO Survey: UK Consumers Could Thwart Strong Customer Authentication

PR Newswire

LONDON, Jan. 31, 2019

New fraud rules under PSD2 demand extra fraud checks, but customers not ready to hand over phone numbers

LONDON, Jan. 31, 2019 /PRNewswire/ --


Lenders, card issuers and payment service providers that need to comply with new fraud rules under PSD2 next year face a challenge from their own customers. In a new FICO survey, only about half of UK consumers say they are willing to give their bank or card issuer their mobile number in order to carry out extra authentication steps. Many banks are counting on authentication using mobile phones to comply with the rules.

One in five respondents say they will refuse to give their mobile number, while one in four say they will complain if asked, either to the bank, on social media or to a consumer association or newspaper. While 53 percent of respondents will provide their mobile number, the percentage dropped to 47 for consumers aged 18-24.

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Part of PSD2, which took effect this year, is increasing the security of financial transactions, in part through Strong Customer Authentication (SCA). SCA involves using two forms of verification based on three categories: knowledge (something only the user knows, like a password), ownership (something only the user has, like their mobile device) and inherence (something the user is, or biometrics). The European Banking Authority has stated which transactions will need SCA when the new rules take effect in September 2019.

The survey also found that there was no consensus on the best way to deliver a one-time passcode:

"Millions of customers have already left brands that failed to provide hassle-free, frictionless digital services," said Russell Robinson, vice president of solution sales management at FICO in Europe. "Banks rolling out SCA next year need to make it easy for customers, and not try to force customers onto a particular communications channel to verify a transaction. Banks that get it right will build on customer loyalty; banks that get it wrong will see their customers flock to other brands and payment types."

Research Now Group Inc surveyed 500 consumers each in the UK, Germany, Spain and Sweden.

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