Millennials likely to bail on banks, card companies in case of false declines
Iovation, a provider of device-based consumer authentication and fraud prevention solutions, has released findings from its study of the effects of false declines on the consumer.
The survey, conducted in partnership with research and advisory firm Aite Group, polled nearly 1,100 consumers across four generations, according to a press release.
Findings from the report, Combating False Declines Through Customer Engagement, show that a large contingent of connected consumers are unforgiving of the inconvenience of a false decline.
More than 42 percent of respondents said that a false decline would motivate them to leave their banking institution altogether.
In 2016, approximately $264 billion in card transactions in the U.S. were lost as a result of false declines due to suspicion of fraud, a number that is projected to grow to $331 billion by 2018.
Findings from the study include:
- consumers' willingness to leave their bank over a false decline was correlated to age — 59 percent of millennials said they were very or somewhat likely to leave, while just 21 percent of seniors would be inclined to do so. Gen Xers and Baby Boomers registered at 39 percent and 32 percent, respectively.
- forty-four percent of consumers with income over $100,000 per year and 48 percent with income between $75,000 and $99,999 per year said they were either somewhat or very likely to leave their FI over a mistakenly declined credit card transaction;
- the majority of consumers — nearly 60 percent — across all age groups are open to an additional prompt for identity verification if there is suspicion of fraud; and
- sixty-five percent of seniors and boomers indicated that it's acceptable for their issuer to request proof of identity if there is suspicion of fraud — 59 percent of Gen Xers and 54 percent of millennials agree.