The must of trust: Preserving customer privacy in the age of digital innovation

“May I have your data?”

”Depends on who’s asking!”

Banks need data from customers to provide them with a differentiated service. They won’t get very far though, until they establish themselves as responsible and trustworthy in customers’ eyes.

While these individuals are willing to share information for a real benefit—providing historical transaction details to an account for financial planning or tax efficiency analysis, for example—they are less likely to provide information when they can’t see an advantage in doing so.  

This conflicts with many banks’ current ‘big data’ strategies where the goal is to capture customer data in the hope that it can be used to tailor a better product or offering for these customers.

The challenge for banks is that they need to differentiate themselves from the bevy of organizations that are mining customer data for malicious purposes such as snooping (the National Security Agency (NSA) PRISM scandal, identify theft, and phishing for fraudulent financial gain.

Building trust

Banks need to demonstrate three things in order to earn the trust of their customers:

  • Commitment to safeguarding customer data
  • Transparency in how they use it
  • Accountability in case they get it wrong (perhaps most important of all)

When it comes to commitment, most banks are already focusing their IT budgets on implementing systems and processes that secure communications with customers especially now that data security and fraud prevention are high on most people’s agendas.

In these times of innovation in digital and mobile banking, banks are also starting to tap into big data sources such as social media and browsing habits, and they will need to strengthen their security solutions to cover these sources as well.

That leaves transparency and accountability. Banks can demonstrate adherence to these values by adopting a strong ‘customer first’ attitude across all their channels. Here they can help nurture a relationship of trust by developing a customer charter that outlines the bank’s commitment, responsibility and accountability concerning the collection and use of customer data.

Nobody is perfect, but if the leadership fosters these values and instils them in the organizational culture, banks have the potential to appeal to customers at the emotional level. But when we do get it wrong though, we must learn from the CEO of Toyota, Akio Toyoda—just make sure you get your bow right!

Views: 279

Comment

You need to be a member of GlobalRisk community to add comments!

Join GlobalRisk community

Our Sponsors

Would you like to reach over 90,000 + Risk Professionals? 

REQUEST OUR MEDIA KIT

______________________

Current Partners Include:

  

 

 

 

Join GRC Inner Circle - Get Top Risk Resources, Member Support PLUS become our patron

Business Exchange

If your organization delivers products and services that bring value to our members, you are welcome to join our partnership program.

Companies are welcome to setup a business profile page in our Multimedia Business Directory. You will get full control of the page and can include cutting edge possibilities – videos, adverts, presentations, white papers, job offers, Press Releases, product information, company blog, news feeds and more.

CLICK HERE TO APPLY

Our Knowledge Partners

Request our MEDIA KIT

Our Twitter feed

© 2020   Created by Boris Agranovich.   Powered by

Badges  |  Report an Issue  |  Terms of Service