In an increasingly digitalised world, trust has become one of the most important commercial currencies of our time. Yet society is experiencing a trust crisis. As consumers rethink their relationships with financial institutions that were the cornerstones of societal trust – particularly since the 2008 global financial crash – the ability of organisations to optimise the full potential of digital transformation is compromised.
What is digital trust?
The World Economic Forum defines digital trust as: “individuals’ expectations that digital technologies and services – and the organisations providing them – will protect all stakeholders’ interests and uphold societal expectations and values.” Put simply, people need financial services firms to safely and ethically manage their identities, personal data, and money.
It’s for these reasons that digital trust is playing an increasingly important role in business success. End-user trust in firms is necessary for them to attract and retain custom. Almost half (47%) of people in the UK would withdraw trust from a business because of data mishandling or selling (Okta); the same percentage of US respondents would sever ties with a company completely following a data breach.
The growing value of digital trust
Digital experiences are now central to almost every transaction and interaction between businesses and their customers. By 2026, around a quarter of the world’s population – 2 billion people – are expected to spend part of their day in an online immersive environment or metaverse (Gartner). And, by 2030, these experiences and interactions are likely to take place without people having to use passwords. Entering payment details and personal information during online transactions is also likely to become a thing of the past.
A new report, The Future of Digital Trust: Authentaverse, by The Future Laboratory and LexisNexis Risk Solutions predicts the creation of this new frictionless way of navigating internet services and eCommerce – dubbed an ‘Authentaverse.’ Such changes in customer behaviour could prove win-win for financial services firms. Transactions would be both quicker and more secure, helping to reduce customer drop-out rates during applications for all manner of products and services. There’s also the opportunity for firms to build a stronger understanding of each individual customer, enabling the development of personalised services that more effectively meet their wants and needs. Huge benefits could be realised here, both in strengthening brand loyalty and increasing customer satisfaction and retention.
Seamless, low-friction transactions will pave the way for the establishment of a new generation of immersive online environments – metaverses. Hybrid digital worlds of virtual and augmented reality have the power to completely reshape how consumers access and manage their money and interact with their banks and financial services providers. The resulting possibilities for compliance, customer service and operational experience are almost beyond the current realms of imagination.
Financial services firms – perfectly placed to facilitate digital trust
Realising the possibilities of a new era of customer verification and authentication will require strong levels of two-way digital trust. It’s critical that organisations can trust the personal information provided by customers and that people feel confident enough engage with businesses, safe in the knowledge that their data will be treated with respect. This level of mutual trust, combined with device and behavioural intelligence to build strong assurance that the user is the genuine customer, will help create an environment where it takes fewer steps and background checks to authenticate a digital entity and fast-track them through to a limitless range of services and applications.
Presently, many consumers remain sceptical and wary about sharing identity data, influenced by many factors including the threat of fraud and financial crime, Big Tech’s abuse of power, digital exclusion, and a lack of basic digital skills. Financial serviced firms are perfectly placed to fill this vacuum through technology and services that lead the way in facilitating genuine, two-way digital trust.
The democratisation of our data
The new, emerging iteration of the internet, Web3, is built on blockchain technologies that enable the transparent sharing of information within an organisation’s network. It will allow internet users to take ownership of their data and more closely control the way in which it is used.
Financial services firms are already the pioneers in this space and are arguably strides ahead in laying the foundations for more customer-first strategies that are essentially rooted in digital trust. By adopting a more human view of data, the opportunity is ripe for firms to lead the way in empowering users to take control, as well as to educate them about the value of personal information, how to protect it in online environments, and how to avoid becoming a commodity for Big Tech’s gain.
