Building Trust in Finance: Challenges & Solutions

Building trust in the financial industry, from the customer's point of view

It’s widely accepted that trust is the cornerstone of almost all customer relationships, however trust is a two-way street and often customers view organisations very differently to how they view themselves.

To highlight the discrepancy between perspectives, Forbes has reported that 87% of business leaders believed that people highly trusted their company – but when asked, only 30% of people trusted these same companies.

In the financial industry, this effect has been accentuated by rapid digital transformation, which has seen a huge number of new players enter the financial ecosystem. This has led to a huge change in the way customers interact with financial organisations, with the majority of Americans now buying insurance online, and over 65% of Europeans now regularly using online banking.

Clearly, balancing the customer experience with the need for tight security and compliance is more important than ever, but it isn’t easy. This article is going to take a closer look at some of the biggest challenges and propose a few solutions.

Challenge 1: Data breaches and ID fraud

A single hack or data breach can undo decades of trust building and have a catastrophic effect on the perception of a financial organisation. The 2023 Thales Data Threat Report – Financial Edition outlines some of the major threats faced today, from dealing with multi-cloud environments, to encryption management, ransomware and even good, old fashioned human error.

These threats include sophisticated phishing scams, complex cyber-attacks aimed at stealing sensitive customer information and ID fraud. The consequences of such breaches are far-reaching, not only in financial terms but also in eroding customer trust.

Solution 1: Improved monitoring

Thales addresses these challenges head-on by developing innovative solutions like Hardware Security Modules (HSM) for transaction encryption and offering a sophisticated Security Operations Centre (SOC). These systems offer real-time monitoring and analysis of security alerts generated by applications and network hardware, enhancing the ability to detect and respond to threats promptly, protecting both company and customer data and IDs.

Challenge 2: Regulatory Challenges

Complying with Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations is another hurdle financial organisations face when building trust. These necessary regulatory measures, while crucial for preventing financial crimes, can sometimes be cumbersome, leading to a slower customer onboarding process and a less-than-ideal customer experience.

If your competitors can help customers negotiate regulatory hurdles quicker and more smoothly, it’s going to be difficult attracting new customers.

Solution 2: Ensuring Compliance

Beyond protecting customer data, Thales helps financial organizations stay compliant with even the strictest regulations. The solutions are not limited to customer interactions but extend to safeguarding data shared with business partners and ensuring end-to-end compliance.

Thales is also a leader when it comes to complying with GDPR and local regulations, offering some of world’s most sophisticated consent, IDCloud risk management and fraud detection solutions.

Challenge 3: Customer churn

A poor customer experience, whether due to complicated security processes or regulatory compliance, can result in high bounce rates and customer churn. In an industry where numerous options are available, customers often gravitate towards institutions that offer both security and convenience.

Solution 3: Better Customer Experiences

Thales offers solutions like User Journey Orchestration (UJO), Progressive Profiling and Consent Management, which are game changers when it comes to improving customer experience. These technologies personalize customer interactions, making them more engaging, while collecting necessary information in a non-intrusive manner. This approach significantly reduces the friction typically associated with striking the balance between security and compliance processes, as outlined in the 2024 Thales Digital Trust Index.

How Thales Helps Financial Organizations Build Trusted Relationships

Thales stands at the forefront of bridging the gap between security and customer experience in the financial sector. By implementing Thales's solutions, financial organizations can not only enhance their security posture and dramatically reduce fraud, but also provide a smoother, more engaging customer experience.

This dual approach is crucial in building and maintaining trust, which is the ultimate currency in the financial world. With Thales, European financial institutions can confidently offer their customers the best of both worlds – uncompromised security coupled with an exceptional customer journey.

Building a future we can all trust

At Thales, the concept of building trust guides almost everything we do. If you’d like to learn how we can help your company build trust in the financial industry reach out one of our experts. You can also listen to our latest Thales Security Sessions Podcast edition, in which we discuss some intriguing new strategies for companies looking to keep their customers and their operations safe.