What key security challenges do omni-channel strategies face?

By : Dena Hamilton

June 14, 2016 12:30 PM

Strong omni-channel banking strategies are a key differentiator in the increasingly  competitive financial services landscape. Consumers want anytime, anywhere banking and  businesses that fail to provide seamless integration across online, mobile and in-store  channels may find themselves falling behind more innovative rivals.


However, technology is often a double-edged sword. The latest advances not only open up  great opportunities but also create new security vulnerabilities. The increasing sophistication  of criminal attacks on banks and customers, largely driven by cyber activity, means  organizations often have a tough time staying one step ahead of fraudsters.


So what are the issues that banks should keep in mind regarding their omni-channel  security  measures?


1. Address mobile weaknesses


A recent study conducted by the Ponemon Institute revealed that just 22 percent of global companies are confident in their security for mobile payments. This compared with 53 percent that believed their traditional PO, checks and credit card payments were secure. Admittedly, the figures are likely higher for financial services firms, but the research suggests a marked difference in security capabilities for mobile. As demand for these services grows, banks will need to explore how to keep the channel secure, whether it's through biometric options - such as fingerprint verification - tokenization or additional passwords and PINs.


2. Don't forget established channels


Cybercrime is increasingly high on the agenda for banks, yet risks remain in more traditional channels. EMV, encryption and tokenization have all helped make physical transactions more secure, yet organizations shouldn't rest on their laurels. For example, ATM skimming is getting more difficult to detect, as devices become smaller and tailored to the machine's design. Card and cash trapping, as well as brute force attacks on ATMs are also still problems that banks must overcome.


3. Forecast future trends


Predicting the future is never easy, but financial service providers that can identify potential channel risks to their organizations stand a better chance of preventing breaches to their systems and processes. As banks close one avenue of opportunity for criminals, others inevitably open and fraudulent behavior quickly evolves to take advantage. Innovative technology, including advanced analytics, can help detect fraud and other malicious activity. However, banks must develop the right skills and frameworks to build a holistic view of the customer journey and spot future areas of weakness.


4. Engage with customers


According to PwC, 61 percent of bank executives believe a customer-centric business model is crucial and 75 percent are making investments in driving this change. Omni-channel security is no different; companies must track consumer data, check social media channels and develop a dialogue to discuss potential changes.


5. Find the right solution


Managing multiple channels is an incredibly complex undertaking, particularly when many organizations still have siloed departments and disparate systems. Deploying a single security product that covers all the bases is therefore unlikely.


Nevertheless, with the right suite of solutions , businesses can build a comprehensive defense against the many potential threats they face, whether these are online, at the ATM or at point of sale. Banks must strike a delicate balance between strengthening security and ensuring new processes don't prevent seamless transactions and interactions.


Ultimately, omni-channel banking brings both opportunities and challenges for businesses. Maintaining security across multiple areas is no easy task and financial service providers must take a multifaceted approach if they wish to optimize the customer experience.


Dena Hamilton

GM/Director, Enterprise Fraud & Security Software Solutions

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Dena specializes in fraud, risk, compliance and security with over 35 years in the financial services space. Her focus is in the development and deployment of enterprise financial crime solutions optimized in prevention, detection and back office efficiency.