Abstract
Overview
With the introduction of any new channel or technology such as the use of mobile devices for banking activity, financial institutions (FIs) must ensure that the perceptions and the realities surrounding security are successfully managed, both to ensure adoption and protect customers and the institution from emerging threats. The key emphasis of this study focuses on the approach that FIs should take toward consumer security education, as well as the need for strong collaboration among vendors, banks and carriers for effective implementation. This report provides a comprehensive analysis of the key security aspects surrounding mobile banking: the security perceptions, preferences and behaviors of consumers; actions that financial institutions are taking to secure the mobile channel; and an assessment of potential threats. Javelin also delves into the mobile security issues of FIs and insights of vendors, extracting valuable insight from in depth interviews with leading US banks and platform suppliers.
Primary Questions
- What are consumers’ security perceptions around mobile banking, and how should FIs address potential obstacles to adoption based on these perceptions?
- What real security issues do FIs face, and how are they securing the mobile channel?
- How serious are these threats and where are they going?
- What are the security advantages/fallbacks of each of the three mobile banking platforms:(browser-based, SMS and downloadable application)?
Table of Contents
- Overview
- Primary Questions
- Findings and Analysis
- Consumer Outlook on Mobile Banking Centers on Uncertainty and Distrust
- Consumer Security Concerns Present a Major Barrier to Adoption
- Differentiate Security in the Mobile Channel to Address Consumer Perceptions
- The “Reality” of Mobile Security: Mobile Viruses and Other Imminent Threats
- Although Mobile Security Is More an Issue of Perception, FIs must Remain Vigilant of Future Threats across Mobile and other Channels
- Strong Collaboration among FIs, Carriers and Vendors Will Allow for Efficient Technology Standardization, Seamless Security
- Security Apprehension Instigates Consumers’ Preference for Biometric Authentication, but FIs Aren’t Worried
- Security Features and Potential Risks by Platform: Browser/WAP, Downloadable Application, SMS/Text Message
- Consumers Perceive Bank-Provided Downloadable Application as Most Secure
- Interactive Financial Messaging™: Leveraging Real-time Capabilities of Mobile Banking for Effective Fraud Mitigation
- Related Research
- Appendix
Table of Figures
- Figure 1: Mobile Banking Deemed as “Too Risky” by One-Third of Consumers
- Figure 2: Nearly Half of Consumers Perceive Mobile Banking as Unsafe
- Figure 3: Consumer Adoption is a Function of Perceived Risks
- Figure 4: Identity Theft Dominates Consumers’ Mobile Banking Concerns
- Figure 5: Consumer Assessment of Threat Levels across Multiple Channels
- Figure 6: Vendors Can Facilitate Communication between FIs and Network Operators
- Figure 7: Consumer Authentication Preferences for Mobile Banking
- Figure 8: Platform Security Overview
- Figure 9: Majority of Security-Concerned Consumers Prefer Application from Bank
- Figure 10: Two-Way Communication Allows Customer Participation in Fraud Prevention
- Figure 11: Two out of Five Consumers Will Select a Platform Based on Security
- Figure 12: Fewer than One out of Ten Consumers Possesses a Smartphone
- Figure 13: Only 8% of Mobile Phone Users Have Mobile Anti-virus Software
- Figure 14: Consumers Prefer to Obtain Mobile Anti-virus Software from their Carrier
- Figure 15: Three out of Ten Consumers Believe Mobile Account Access Is Safe
- Figure 16: Consumers Perceive Financial Transactions to be Less Safe
- Figure 17: Among all Channels, Mobile Banking Viewed to be the Least Safe
- Figure 18: Security Is Less of a Concern among Mobile Internet Users
- Figure 19: One out of Five Mobile Internet Users Has Anti-virus Software Installed
- Figure 20: For One out of Four Consumers, Zero Liability Will Not Boost Mobile Banking
- Figure 21: Nearly Half of Online Bankers Believe Mobile Banking is Unsafe
