For millennials, banking needs to be embedded and ubiquitous. Banking is just one of the thousands of activities digital natives engage in on a daily basis. To them, making payments, withdrawing money or any other engagement with financial institutions needs to come as naturally as ordering a coffee or browsing through Tinder. Millennials go where convenience takes them. This has a huge impact on the way retail banks need to organize themselves, and how they implement Identity and Access Management (IAM). How easy you make banking to digital natives can make all the difference in being swiped left or right.
Read on to learn how:
Millennials prefer digital experiences with a bank over visits to a brick-and-mortar bank branch. They do their banking activities in their back pocket – because that’s where they keep their smartphone. Research reveals that digital natives are the most active group in mobile banking. Almost half (47%) of digital natives only use mobile banking, which is twice the number of baby boomers who bank through their mobile device.
The trouble for a bank is: holding on to that space in their back pocket is not easy. Millennials are the fastest to jump ship when the digital experience frustrates them. They are much quicker to switch mobile applications than Generation X or baby boomers. Transactions that take too long, interfaces that are too cluttered, … millennials have little patience. Couple that with the fact that digital natives are 2.5 times more likely to switch banks than baby boomers or Gen Xers, and banks know they have to go the extra mile to capture the younger generations.
Millennials are tech-savvy, and they expect the same from their banking partner. That explains why neobanks and FinTech are so popular with digital natives. Traditional banks need to demonstrate the same streamlined and tech-centered approach to win their hearts.
Identity and Access Management is key in helping retail banks deliver the mobile experience to millennials, by offering new services in a secure way, optimizing their user experience by reducing the number of times that they need to login, enabling passwordless authentication, allowing digital onboarding,… TrustBuilder Identity Hub dynamically adapts every step of the user journey to the context.
Digital natives have busy lives and don’t want to shop in many places to purchase goods or services. Large online retailers such as Amazon are very popular with millennials, as these kinds of platforms offer a variety of services. Research suggests this approach also applies when it comes to banking services, or services that youngsters can acquire through banks.
Research performed by American analyst firm Cornerstone Advisors shows that digital natives prefer banks that offer a broad range of services, including non-financial services.
When asked what type of company they would turn to when purchasing a bundle of services including roadside assistance, cellphone damage protection, travel insurance or personal data storage, banks turned out to be quite popular.
By offering these non-financial services, retail banks cannot only retain millennials as customers, they are also assuring themselves of extra revenue.
Over the last few years, retail banks have started developing ecosystems of services, differentiating themselves from their competitors by providing access to non-financial services through their smartphone apps. The range of services that is offered, differs widely, but includes travel tickets, insurance, festival tickets. Some banks even allow non-banking customers to use their smartphone app to purchase these services, in the hope of later converting them into customers.
Millennials are concerned about safety, identity theft and privacy and require their financial institutions to ensure secure connections to all services offered. As third-party services are offered through microservices, financial institutions depend on API security to live up to expectations. TrustBuilder Identity Hub provides API security, not just at the edge, when a user connects to the service, but also between the different microservices. Once a user is authenticated, TrustBuilder captures the user context to afford access to those microservices that the user has privileges to. Working with TrustBuilder provides adequate security in complex environments with hundreds of APIs.
Recent research shows that 93 percent of millennials who use mobile banking have abandoned a transaction because of a forgotten password. As the generations of digital natives require ease of use and convenience, they are looking for new ways to authenticate than the traditional username/password combinations, or token-generating devices. Millennials want to be able to connect to their banking systems just as seamlessly as they do to any other app on their smartphone.
Identity and Access Management offers a solution here, by allowing customers to bring their own authentication (BYOAuth). TrustBuilder Identity Hub provides support for different identity providers. Consumers can authenticate, for instance, using a social login through identity providers such as Google, Fitbit, or Microsoft, by using an eIDAS (Electronic IDentification Authentication and trust Service) like Itsme or eHerkenning, or a range of biometric means such as iris scan or fingerprint.
Attribute-based Access Control (ABAC) plays a big role in achieving passwordless authentication. ABAC derives a users’ identity on the basis of the attributes to make an authorization, rather than on the identity itself or its role within an organization An attribute can be used in itself, or in combination with other attributes to tighten security. ABAC is the only model that supports contextual information, for instance geolocation, fingerprint, device, access channel,… TrustBuilder Identity Hub offers an ABAC engine, which combines powerful policy implementation and execution with an unlimited array of attributes. In this way, it can be tailored to specific needs and requirements. That way, retail banks can combine user experience with fine-grained security.
If another bank offered a digital app that was superior to the one they are currently using, half of all digital natives would not hesitate to switch to that other bank. Millennials prefer companies that innovate and use the latest tech. For banks, this attitude of their youngest customers drives them to constantly refresh their strategy, their technology, and their apps. Although digital natives prefer to do their banking on the smartphone, they are not averse to using other channels either, for instance a bank branch. This forces retail banks to keep all channels up to date, offering the same kind of user experience.
Retail banks can rely on TrustBuilder Identity Hub to ensure a seamless customer experience across the different channels they want to address. Our visual workflow creation facilitates an easy mapping of the user journey and the addition of new use cases on the different channels, while our orchestration hub manages access for everyone to every system.
Digital natives may not be the easiest target group for a retail bank. They easily switch from one brand to another and share their experiences (good or bad) with friends and family. In their relationship with a bank, a good mobile experience tops the list. Technology exists to cater to the needs of millennials and the upcoming Generation Z. Retail banks that offer a broad range of services through ecosystems with third parties, and that continue to create a seamless omnichannel experience are set to gain the hearts and minds of a generation that is about to live a number of key life events in the coming years.
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