Fighting Cybercrime: How Banks Can Turn Threats into Opportunities

With cybercrime and ransom hacks being a common occurrence in today’s newsrooms, Karen Wheeler, VP UK Country Manager at Affinion talks to Finance Monthly about the opportunities that can arise from these kinds of threats, for the banking sector in particular.

We’re living in a world where high profile data hacking scandals and cybercrime attacks dominate our headlines on an almost daily basis. New research by Barclays has revealed that last year alone saw a total of 5.6m cases of cyber fraud reported across the UK; a figure accounting for nearly half of all UK crimes, affecting both companies and consumers alike.

The newest member of the ever-growing club of victims is the NHS, which last week saw a colossal attack in which criminals took control of computers and held hospitals at ransom. But despite the mass media coverage, it’s not just high-profile organisations that are targeted. Cyber criminals are also after sensitive customer information and payment details that can be traded on the dark web.

Clearly, no one is exempt from the threat of digital fraud, and Barclays’ research highlights the need for education on protection methods amongst UK consumers. In fact, almost 40% of people believe they can’t prevent cybercrime, according to a survey by Get Safe Online.

While there’s no doubt that cyber-crime exists, the number of reported cases suggests there could be a lack of clarity around who can be targeted and what constitutes risky cyber behaviour. Furthermore, who is responsible to protect against digital crimes and how customers can protect themselves.

Step 1: Recognise the opportunity

Following its research, Barclays’ has also announced plans to lead a £10million campaign against digital fraud with a primary aim to educate customers. Its campaign, and the current climate in which cybercrime is rife, illustrates a clear opportunity for banks to step up and adopt a role of responsibility in this field; positioning themselves as experts in educating on risk and how customers can protect their identities from digital fraud.

While some financial services institutions may question whether or not this is their job, given the amount of money they lose as a result of fraud, perhaps the question they should be asking is whether or not they can afford not to address this issue?

However, the truth is that banks are actually among the most trusted brands by consumers when it comes to data security. The Symantec State of Privacy Report in 2015 revealed that 66% of banks were the third most trusted by their customers to handle data; only hospitals and medical services ranked above.  Evidently, there’s already a great deal of trust and brand value that exists for financial services institutions when it comes to handling data, meaning customers are likely to value their banks’ advice. This is something that currently, many are failing to utilise.

There’s a lot to learn from Barclays and by recognising this as an opportunity, not a challenge, banks can enable customers to make better fraud prevention choices, enhance loyalty and build deeper, more valuable customer relations in a fiercely competitive market.

Step 2: Educate and empower

By enabling people to make better security and fraud prevention choices that are backed up by relevant and knowledgeable support when things go wrong, banks can enhance their reputation amongst existing and potential customers. For example, Barclays’ upcoming digital-led safety campaign provides free support to SMEs as well as an online quiz for customers to assess their overall digital safety level - equipped with advice and tips for improvement.

Whilst this might sound like simple advice, it is guidance that could empower customers to be a little more careful about who they disclose their personal information to. Other examples might include a helpline to provide customers with peace of mind. Such a service could increase a customer’s bond and loyalty to their bank.

Step 3: Offer additional services

In addition to educating and advising customers about risks and ways to protect their identity, banks can also take further steps to build loyalty by offering additional and exclusive services. Barclays is now giving customers the opportunity to set up daily ATM withdrawal limits on their mobile banking app, to prevent the risk of security breaches. This is just one example of an additional account protection service that a bank could offer its customers on top of advice.

By taking responsibility and offering customers not just advice, but an actual service that will help protect themselves, a bank can its extend the influence into customers’ lives, improving their value and retention. In fact, our recent study looking at customer engagement found that banks that offer ‘protecting the customer’ products have 13 per cent higher customer engagement scores compared to the average, meaning they stay longer and are more likely to recommend to others.

Cyber-security attacks have, and will continue to, present a significant threat because of the connectivity of modern life, unless action is taken. There is an ever-rising level of customer data online, which both businesses and customers need to take responsibility for keeping safe. But amidst the threat and concern, there is an opportunity for financial services institutions to look beyond this and instead see the challenge as a chance to build more loyal and lasting customer relations.