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DO YOU TAKE CARDS? PAYMENT CARDS STILL RULE IN A CASHLESS SOCIETY

Banking industry needs to future-proof payment cards as UK consumers are still not ready to give up their bank cards

 

As the UK fast progresses towards a cashless society, consumers have made it clear they are not prepared to give up their bank cards. Research by IDEX Biometrics ASA has revealed three quarters (75%) of UK consumers are concerned about the UK becoming a cardless society, where they no longer have access to a physical debit card and could only rely on mobile payments. Evidently, UK consumers are actually more worried about the idea of a cardless society, than a cashless one.

 

For more than a third (37%) of consumers, as long as they have a debit card, the thought of a cashless society doesn’t bother them. Maybe not surprisingly, this is even more pronounced among young consumers, with 53% of 25-34-year-olds unworried about our growing cashless society, providing they still have a bank card.

 

These findings highlight that banks and financial institutions need to reconsider the cashless transition. This is true for all generations, as only 20% of all UK consumers believe we should already be a cashless society, but particularly so for the older generations, with only 9% of over 55s agreeing we should already be cashless.

 

In fact, despite the increasing popularity of smartphone payment apps, six-in-ten (60%) respondents would not give up their debit card in favour of mobile payments. This caution is likely stemming from security concerns, with a further 68% stating they still feel more secure using their debit card than a mobile payment and half (50%) of consumers concerned that contactless payments are insecure.

 

However, four-in-ten (41%) would trust the use of their fingerprint to authenticate payments from their bank card more than a PIN. This figure remains consistent across all age groups, highlighting consumers’ confidence in payment cards secured by biometric authentication.

 

Misuse of mobile payments is another major concern for consumers. 58% worry that if they lost their mobile phone, people would be able to access their bank accounts. In contrast, even if stolen or lost, a biometric bank card can’t be mis-used without the owner’s fingerprint.

 

“With UK consumers showing their continued attachment to bank cards, it’s time for the financial services industry to future-proof payment cards for the next generation. Customers are still sceptical about mobile payment apps but, given their security concerns, they also require more protection than a PIN currently provides,” comments David Orme, SVP of IDEX Biometrics ASA.

 

“This shows that there is clear demand for payment cards that provide the convenience of contactless payments with the added security of biometric fingerprint authentication. As the owner’s fingerprint needs to be present for biometric payment cards to work, reliable bank cards enhanced with biometric technology will prevent misuse and card fraud. This will bring reassurance to all consumers as the UK continues to progress towards a cashless society,” added Orme.

 

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RISE IN E-COMMERCE FOR SMALL BUSINESSES IS A BIGGER RISK THAN JUST STOCK CONTROL

  • With consumer confidence in the high street at an all-time low, many SME shops and businesses have moved to online retail
  • Online retail sales rose by record 19.7% between April and May 2020
  • SMEs lack of IT knowledge, experience and skills could lead to potential online dangers from hackers obtaining personal data and fraudsters posing as you.

 

The high street, having already suffered a dramatic decrease in popularity, has struggled to return to pre-COVID sales figures, but is showing some signs of improvement. When non-essential shops were forced to close during lockdown, consumers were forced online.

For some SMEs this was devastating for their retail outlets and businesses. However keen entrepreneurs were driven to adjust their businesses to survive this crisis and technology became their saviour. According to the ONS Monthly Business Survey for May 2020[1], online retail for all sectors rose by 19.7% in May compared to April 2020, for many reaching this market was the only way to save their businesses. A staggering 85,000 stores appearing online in the three months to July 2020. However, business owners are being urged to review their online presence considering security issues posed with ecommerce trading.

ILUX, a leading IT systems, support and service company has been looking at the potential implications of inexperienced company owners launching their online presence. James Tilbury, managing director comments: “The pandemic and the lockdown has been the biggest pressure any company owner is likely to ever face. Even with the government support available, many would not have survived this time without shifting focus and identifying what can be done to save their business. Ecommerce offers endless opportunities, nationally and even internationally, to grow your business from a small shop or two, to a profitable and effective online store. But it does not come without risks.”

Worryingly, 32% of SMEs have been the target of cyber scams or malware with half of 5,000 SMEs surveyed by Sage[i], worried about their business being at a bigger risk since going online. However, only 6% would be investing in additional security.

ILUX, after reading these statistics, have realised some small business need some IT education. The company has produced some top tips to improve online security – for some immediate peace of mind. As a small business, the reputational and financial impact of a situation like a data breach will be destructive for a business, no matter how stable you think you are.

 

UNDERSTANDING DATA THAT SHOULD NOT BE SHARED

As a smaller business you may be working with just a few members of staff, but it is essential that they know what data is sensitive and what should not be shared. Training your staff could prevent internal data breaches, especially when it comes to GDPR (UK-GDPR from 2021). If your ecommerce site is hosted on Shopify, this data would be protected and should not be downloaded or shared.

 

SECURITY PROTECTION AND UPDATES ON LOCAL COMPUTERS

Although this is common sense, it is disturbing how many companies have out-of-date and even obsolete security software on their local computers. All anti-virus and malware software should be updated regularly. If a company has multiple devices in various locations, owners should set a reminder to ensure staff are checking for updates and make sure all software, when installed, is set to perform them automatically. Invest in trusted and quality products, you will get what you pay for, using a free platform when you are handling personal data is not recommended.

 

ENCRYPTION

Encrypt all your sensitive data at rest and in transit. Use of encryption allows only those with access to decrypt the contents of the file that has been converted using a special “key”. This means that even emails which are sent to other parties with personal data in them, or when you are uploading shipping address details to couriers, they are safe from anyone trying to intercept the data.

 

CYBER ESSENTIALS

Cyber Essentials is a simple but effective, Government backed scheme that will help you to protect your organisation, whatever its size, against a whole range of the most common cyber-attacks. Certification gives you peace of mind that your defences will protect against most common cyber-attacks – simply because these attacks are looking for targets without Cyber Essentials technical controls in place.

 

HOUSEKEEPING

As mentioned above, updates are essential for all software. Consider two-step verification too – to provide that extra layer of security. Encourage your staff to update localised passwords frequently – monthly is acceptable. Educate staff on identifying harmful emails – do not follow links or enter account information on anything received in an email. Ensure all networked passwords are secure and impossible to predict – change them regularly and only allow single person access per machine. Audit your systems regularly, and where you can, use external sources to review and monitor the company systems – the extra set of eyes can make all the difference.

James continues: “Online security should be risk assessed at the earliest convenience. If a small business owner has rushed to complete their transition to online, now is the time to sit back and analyse how robust those systems are. It is not as simple as logging into a Shopify account for instance – careful consideration is essential for all devices – whether that is PCs, laptops, tablets, and even mobile phones that handle any data. A customer data breach could be a costly exercise for the business – not just the financial implications, but this could become legal and involve larges fines for the business. Either way it will be detrimental to the business’ reputation. I would advise that all SMEs who are now selling online to bring in an external, professional and specialist set of eyes to overhaul your systems and protect you for the future.”

Businesses who have delved into ecommerce – and are concerned about the systems that have in place – are welcome to contact ILUX – they will be able to discuss the minimum requirements and offer some insight and support.

 

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BNP PARIBAS PERSONAL FINANCE COLLABORATES WITH EXPERIAN AND ARYZA TO HELP CUSTOMERS THROUGH THE COVID-19 PANDEMIC

The consumer finance specialist will be using the Open Banking tool to help customers create an affordable payment plan based on their financial circumstances

 

BNP Paribas Personal Finance will use Experian’s Open Banking technology and Aryza’s Debtsense digital platform to provide round-the-clock online account reviews to customers who have been affected by the Covid-19 pandemic.

Consumer finance specialist BNP Paribas Personal Finance has moved quickly with its partners to put the solution in place inside six weeks so that it can meet changing regulatory advice. Debtsense from Aryza uses Experian’s Open Banking service to allow people to share their account and transaction data, giving a clear and detailed picture of affordability, financial circumstances and commitments in rapid time.

The insights will enable BNP Paribas Personal Finance to accurately assess people whose finances have been affected by the pandemic and who may now be vulnerable. They can then be offered a payment break or an affordable payment plan based on their specific circumstances. The app uses the lender’s credit decision policy rules to create a personalised payment plan.

 

Stephen Hunt, CEO of BNP Paribas Personal Finance, said: “It’s clear that the impacts of the COVID-19 pandemic are having a far-reaching effect on consumers and the wider economy. Throughout this situation our focus has been supporting our customers as most of them have been impacted in one way or another by the coronavirus crisis and subsequent lockdown measures.

This collaboration with Experian and Aryza is a great example of companies coming together to innovate using the latest tech so we can help our customers quickly and easily set up a payment arrangement based on their affordability. Through launching this fully automated service to our customers, we believe this will be helpful, convenient and provide reassurance and control for our customers who need support as we emerge from this pandemic.”

 

Lisa Fretwell, Managing Director of Data Services at Experian, said: “The Covid-19 pandemic is having a significant effect on the economy and people’s household budgets. As we move towards the recovery stage of the crisis, it’s crucial lenders and financial providers have accurate and insightful information about their customers.

“Debtsense gives users the ability to assess someone’s affordability almost instantly, providing a 360-degree view of their financial circumstances. We’re pleased to be working with BNP Paribas Personal Finance so the tool can support their customers during this challenging time.”

 

Colin Brown, CEO of Aryza Group, said: “We are passionate about making consumer finance more accessible using technology. Over the years we have developed tools that allow consumers to re-engage on their own terms in a fully digital experience. We are delighted that BNP Paribas Personal Finance has embraced our technology and is using it to help those customers that are affected by Covid-19.”

More than 200 organisations are currently using Experian’s Open Banking service, many to help resolve financial hardship as a result of Covid-19 pandemic. Charities including Citizens Advice Liverpool and Mental Health & Money Advice are using the service to support clients through the pandemic, tailoring advice based on the individual’s situation.

Experian has been at the forefront and a leading innovator in the development of Open Banking technology. Its Open Data platform underpins more than 52 million API requests a month.

BNP Paribas Personal Finance will be using the Debtsense app via credit and debt recovery software specialist Aryza. The platform will help to support those in arrears as customers can set up affordable repayment plans and make payments in real-time using a mobile phone.

 

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