In a digital-first world, identity verification must not hinder new business
BANGKOK–(BUSINESS WIRE)–Aug. 01, 2024
(NYSE: FICO)
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1 in 3 Thais have abandoned opening a personal bank account due to complex identity checks. (Graphic: FICO)
Highlights
- Ease of use is the top priority for Thais, followed by good fraud protection
- Two in three consumers expect to answer 10 questions or less or they will abandon a savings account application
- Identity checks are on the rise but one in three Thais will stop or reduce the use of existing accounts if the identity verification experience is poor
Global analytics software leader FICO today unveiled its latest global consumer fraud research, highlighting that consumers in Thailand have a low tolerance for inefficient digital experiences when opening an account via mobile app or website. According to the study, Thais selecting a new financial account prioritize ease of use above all else.
Nearly two in three (63%) expect to answer 10 questions or less or they will abandon a personal bank account application. Just over one in four (26%) will drop out if asked more than five questions.
Regardless of the number of questions asked, one in five Thais will give up on a personal bank account application after 10 minutes.
More information: https://www.fico.com/en/latest-thinking/ebook/consumer-survey-2023-digital-banking-customer-preferences-and-fraud-controls
“Thai consumers are embracing digital banking and are demanding seamless account opening experiences,” said Aashish Sharma, APAC segment leader for risk lifecycle and decision management at FICO. “To meet these expectations, our research shows that a critical step financial institutions need to take to retain customers and enhance customer satisfaction is streamlining processes.”
Friction Frustration Exceeds Fraud Worries
In the past year, more than half of Thais have noticed more identity checks when they log in to bank accounts (60%) or make an online purchase (63%).
This increase in identity checks by Thai banks is a direct response to the significant issue of identity theft in the country. One in eight consumers (12%) have confirmed that their identity has been fraudulently used to open an account, and nearly half (49%) suspect that it has.
Despite this, frustration with identity checks can alter consumer behavior. The FICO survey revealed that one in three bank customers have either stopped or reduced their use of existing personal bank accounts and credit cards, citing the cumbersome and time-consuming nature of these identity verification processes.
Mortgages and Loans Application Process Deserve More Scrutiny
Thai consumers show varying levels of patience for different account opening processes. They are most likely to abandon personal loan applications (39%) due to complex or time-consuming identity checks.
Approximately one in three (35%) have abandoned credit card applications for the same reason or have been frustrated enough to abandon mortgage applications (30%).
Additionally, only one in ten Thai consumers (10%) feel comfortable opening a mortgage account through digital channels, while a significant 36% prefer to apply for personal loans in person at a branch, rather than opting for online alternatives.
While some consumers are more tolerant of detailed processes for certain financial products that require thorough scrutiny, the survey clearly shows that expectations for ease of use remain high.
“With more customers using digital services for faster online loan approvals, banks must tackle and reduce consumer frustration caused by ineffective identity checks,” added Sharma. “Close to half of Thais (44%) will not complete a digital mortgage application or a personal loan application (48%) if it has more than ten questions.”
Appreciation for Digital Application Advantages
When asked about the benefits of opening an account digitally via the provider’s app, ease of use and speed were identified as the top advantages (74%). Similarly, Thais ranked speed (75%) as the top advantage via the provider’s website, followed by the ability to open an account from anywhere (72%).
In contrast, four in five Thais (80%) believe in-branch applications offer better security, with only about one in two (49%) counting security as a benefit of digital account applications via the provider’s app, and two in five (42%) via the provider’s website.
“Consumers crave a smooth onboarding experience, but security remains paramount,” noted Sharma. “Consumers want smarter onboarding processes and identity checks, not riskier processes. While they appreciate appropriate security for high-value transactions, they expect banks to streamline the process by leveraging technologies like improved identity verification, transaction history analysis, open banking and government databases.”
The survey was conducted in November 2023 by an independent research company adhering to research industry standards. 1,002 Thai adults were surveyed, along with approximately 12,000 other consumers in Canada, U.S., Brazil, Colombia, Mexico, The Philippines, Indonesia, Malaysia, Singapore, India, U.K. and Spain.
About FICO
FICO (NYSE: FICO) powers decisions that help people and businesses around the world prosper. Founded in 1956, the company is a pioneer in the use of predictive analytics and data science to improve operational decisions. FICO holds more than 200 US and foreign patents on technologies that increase profitability, customer satisfaction and growth for businesses in financial services, insurance, telecommunications, health care, retail and many other industries. Using FICO solutions, businesses in more than 100 countries do everything from protecting 4 billion payment cards from fraud, to improving financial inclusion, to increasing supply chain resiliency. The FICO® Score, used by 90% of top US lenders, is the standard measure of consumer credit risk in the US and has been made available in over 40 other countries, improving risk management, credit access and transparency. Learn more at www.fico.com.
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Contact:
Lizzy Li
RICE for FICO
+65 9034 7768
lizzy.li@ricecomms.com
Saxon Shirley
FICO
+65 9171 0965
saxonshirley@fico.com
