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Survey explores effects of fraud, service, security on consumers' choice of FIs

November 2, 2018

In 2017, 17 percent of consumers experienced fraudulent bank account activity, up slightly from 15 percent the previous year.

More concerning, 15 percent of those respondents experienced five or more fraudulent incidents in the 12-month period, and 9 percent reported switching banks in response.

Still, a clear majority of consumers — 92 percent — were satisfied with their FI's handling of fraudulent activity; 25 percent said surveillance video helped to resolve the incident.

These findings come from the second annual survey by intelligent video solutions provider March Networks. The survey explored how fraud, customer service and security perceptions influence decision making by U.S. bank customers.

This year's survey results show that a continued focus on the customer experience remains critical for banks and credit unions when it comes to retention. Approximately 20 percent of respondents confirmed that they had switched banks in the past year because of poor in-branch service.

Further, 70 percent said they would consider switching banks if their local branch did not appear clean and tidy — with that number rising to 77 percent for consumers living in households with children.

Consumer banking choices are also influenced by how secure they feel when conducting transactions, either in their local branch, at an ATM or online. A majority of consumers (98 percent) felt most secure when conducting transactions at their local banking branch, compared with 93 percent of transactions online and 83 percent using a mobile application.

Half of consumers reported that they did not conduct an ATM transaction at least once in 2017 because someone was loitering nearby, putting the onus on banks and credit unions to increase monitoring capabilities around their ATMs.

Other key findings from the survey reveal that:

• Of consumers who bank online and via mobile app, nearly three-quarters also bank at their local retail branch.
• The number of millennials who reported using their local branch increased from 61 percent in 2016 to 72 percent in 2017.
• 63 percent of consumers noticed fraudulent activity on their account themselves; 37 percent were notified by their bank or credit union.
• 46 percent of consumers said waiting more than five minutes for service in a retail branch is unreasonable.
• More than 90 percent believe that surveillance cameras at a branch deter crime, and 96 percent believe that video surveillance is an important contributor to solving crimes quickly.

"Consumers today are engaging digitally with their financial institutions more often, but are also frequently turning to in-person services and have high expectations when it comes to service and security," March Networks CEO Peter Strom said in the press release.

"Understanding consumer perceptions and how they influence where consumers choose to bank is important for all financial institutions — especially when it comes to strategic planning and the dramatic transformation many institutions are currently undertaking to increase their competitive position."