Biometrics needed to stem losses amid increased digital account use, Onfido says
Despite the growth in digital account usage from April to July 2020 due to COVID lockdowns, Onfido’s latest survey results revealed a significant rise in account-abandonment due to security and privacy concerns. Trust in identity verification with biometrics and ID document checks, however, has reached the point where the technology could reassure online customers.
The “Customer attitudes to digital identity: meet the expectations of tomorrow” survey also shows that from April 2020 almost two-thirds of customers (59 percent) accessed more digital services than usual, with 18 percent accessing accounts at least 50 percent more often during that period. The rise in usage by Gen-Z customers (ages 18-24) was even more significant. Of this group, 78 percent accessed more online services and 28 percent reported accessing their accounts 50 percent more often.
While the survey shows increased digital account use, it also reveals significant account set-up abandonments due to increased privacy and security concerns. More than 4 in 10 users (43 percent) have abandoned their account set up due to concerns about third-party access to customer data (53 percent), the security of customer information (50 percent), and forms asking for too much information (37 percent).
Onfido Chief Marketing Officer Robert Humphrey commented: “We are not surprised that COVID lockdowns would increase the use of online accounts, but the rate of abandonment during account sign up due to security and privacy concerns was surprising to us”.
These customer concerns translate into direct losses for online businesses. According to the survey, over half of customers (59 percent) decline to do use businesses they do not trust. The number of Gen Z customers is even more significant (65 percent).
In light of these sobering numbers, Humphrey sees an opportunity for businesses to offer more seamless, user-friendly onboarding methods, while still employing strong authentication and verification techniques. According to Onfido, document and biometric checks may alleviate privacy and security concerns as they have shown increased trust in businesses. Eighty percent of respondents stated that they trust businesses that conduct biometric and document checks compared to ones that use other methods (67 percent).
The August 2020 study, commissioned by Onfido and carried out by Dynata, evaluated a group of 4,000 individuals from the United States, United Kingdom, France, and Germany using an online panel.