Security vs. Convenience: A Framework for Balancing Digital Banking Friction

Balancing security and convenience is one of the most difficult and important tightrope walks in digital banking. FIs don’t need to neglect security or overhaul digital banking to offer easier customer experiences, but they need to ensure that the customer remains front of mind when those experiences are designed. By resolving key questions about digital banking friction points, FIs can clarify whether the friction or speed bump in question is meaningful, understandable, and resolvable for the customer and thus whether it’s worth keeping or curtailed for a simpler user experience. 

Account opening and Zelle transactions offer two excellent examples of areas where the security-vs.-convenience equilibrium is critical. Safeguards are necessary in the account-opening process to limit fraud and money laundering. But the FI’s confidence that the applicant is who they say they are should be a strong consideration in the effort it takes them to get through the application. With Zelle, the need for meaningful speed bumps in transactions is significant given that real-time payments carry inherent risks due to their speed and irreversibility.

Key questions discussed in this report: 

• What factors should FIs consider to ensure that user experience strikes the balance between security and convenience?
• How could those factors help enhance digital account opening experiences?
• How could those factors help better protect Zelle users while streamlining their transactions? 

Companies Mentioned: 

Bank of America, Cash App, Chase, EWS, Huntington, PayPal, PNC, Regions, U.S. Bank, Venmo, Wells Fargo