The COVID-19 pandemic has influenced banks and financial institutions in executing safe and efficient banking transactions. Individuals prefer to engage in fast and convenient contactless payments. Based on the I-SCOOP Online guide to digital business transformation, 90% of clients will likely participate in online banking services. Thus, banking facilities adapt to digitalization to improve customer experience and develop new products and services.
However, challenges to adapting to market disruptions are still present. With the advancement of technologies, banks must apply cutting-edge technologies to execute their digital onboarding initiatives.
Digital onboarding allows customers to register online and access financial institutions’ products, services, and facilities. A well-designed digital onboarding process reduces time-consuming procedures such as filling out paperwork, making cash payments, and submitting documents.
Furthermore, the onboarding process establishes the initial contact between the bank and the prospective client. It can determine whether the user finishes the process and chooses a bank or abandons it and does business with another bank.
Despite the advantages of technology, financial institutions are having difficulties obtaining seamless and effective digital onboarding. Therefore, they must aim to acquire a well-structured system involving legal, credit, and operations departments. Banking companies must consider cyber security to avoid data breaches and a bad reputation.
Unencrypted data, viruses, unsecured third-party services, and spoofing are the critical factors associated with digital banking. Fraudsters capitalize on consumers’ lax privacy practices. Weak passwords and unprotected networks are the primary targets for thieves attempting to obtain login credentials and commit fraud. A reputable bank should not only ask their customers to be careful, but they should also help them verify that they are who they say they are.
Consequently, banks must keep pace with the changing banking habits of customers and their increasing e-commerce capabilities. The demand for fully virtualized and contactless banking services will continue to rise as people discover its benefits. These institutions should use cutting-edge security services like FIDO2 passwordless authentication to alleviate fraud and cyber threats.
As the internet becomes vulnerable to cyber risks, payment authentication is essential to confirm users’ identities, secure online transactions, and protect their customers from cybercriminals. Companies can also use AI to address customer needs better and increase banks’ capacity to provide adequate customer service.