Despite Their Uptake, Micropayment Apps Still Face Trust and Security Issues From Customers

Consumers are banking through more channels than ever before, according to new research released by Verint  (NASDAQ: VRNT), The Customer Engagement Company. Consumers surveyed in March 2021 used an average of 4.1 channels, while Generation X (Gen Xers) banked using an average of 5.3 channels.

The study also shows the growing adoption and usage of micropayment apps. The use of micropayment apps has increased since 2020, with twice as many customers using Venmo and Zelle and nearly three-quarters of all respondents using PayPal – but consumer concerns about trust related to use of these services remains a barrier.

Trust increases significantly when these apps are operated through the customer’s bank, but trust is still an issue particularly for older generations. While 39% of Millennials and Gen Xers use these apps more now than in 2020, Baby Boomers remain wary and are less likely to trust the bank’s app, and 46% of Baby Boomers don’t use these apps at all.

A significant percentage of banking customers tried a digital-first, self-service approach to engaging with their bank during the pandemic – 75% to resolve an issue, 73% to open an account or apply for a new product or service, 73% to gain information on a new product or service, and 60% to conduct a transaction. However, the high rate of digital self-service failure is forcing consumers to escalate to the contact centre, chat, email, drive-thru or branch locations.

Ease of digital banking and availability of security measures are among the top consumer priorities. Nearly two-thirds (63%) of consumers leverage fraud alerts. Of those not using this feature, 40% didn’t know they were available, while 21% said they didn’t know how to sign up.

American Express, US Bank, Citizens Bank, and Wells Fargo showed the largest year-over-year gains in customer satisfaction (CSAT), but all top 15 banks included in the evaluation showed improvement in this key metric, highlighting the industry’s proficiency in navigating a tumultuous year while continuing to deliver excellent experiences. When measured using a predictive methodology, higher CSAT drives loyalty, trust, and recommendations. American Express, TD Bank, and US Bank also showed statistically significant increases in Net Promoter Scores® (NPS).

“Banks have just been through one of the most challenging years in recent history, and this arduous landscape is unlikely to change anytime soon,” says Verint’s Kevin Daly, global vice president and GM, experience management. “Our research shows that as customer experience grows more important every year, the realm of customer engagement and customer experience is getting harder to navigate. Customer journeys are more complex and expectations are higher than ever. The largest banks in the US have found a way to stay on top over the past year but will need to stay vigilant. Meanwhile smaller banks will have to work twice as hard to compete.”

The research is based on the Verint Experience Index: Banking benchmark survey of consumer satisfaction with 15 leading banks and includes CSAT and NPS rankings. Consumers were surveyed in March 2021, allowing for comparisons to customer experience in 2020, both just before and just after the pandemic started. For more than a decade, the Verint Experience Index (VXI) has chronicled digital and omnichannel experiences across key industries including banking.

Banks were evaluated on their proficiency across five key drivers that impact customer satisfaction using Verint’s predictive model: branches (convenience, location variety, service level); confidence (transaction accuracy, security, protecting PII); products (meet financial requirements, flexibility, clarity of terms); representatives (understanding, responsiveness, resolution); and services (account management, access, simplicity).