Businesses may need to rethink their approaches to identity verification for millennial consumers.
These consumers are concerned about how financial institutions, retailers and mobile wallets handle their sensitive information, according to LexisNexis Risk Solutions’ latest study, released Tuesday. Millennials’ desire for secure access on all connected devices is bringing more and more friction to their distrust and unwillingness to share personal information and to businesses’ “need” to gather critical data for fraud prevention purposes.
To reduce that friction, mitigate risk and balance consumer expectations, companies need to ask only for the information they actually need, said Kimberly Little Sutherland, senior director of fraud management at LexisNexis Risk Solutions.
“Currently many companies are asking for information required by their existing technology systems but that is not actually needed in their workflow,” she said in an Oct. 18 news release. For example, she pointed out some U.S. companies don’t need consumers’ Social Security numbers, but their businesses ask for them still.
“Many companies are working with systems that have redundancies and backup plans built in, when in reality they should have stronger primary identity verification,” Sutherland added. “Stronger primary identity verification would ensure that companies don’t have to rely on more intrusive secondary verification processes that ask for supplemental, and in some cases unnecessary, data.”
The Millennial Study: Privacy vs. Customer Experience report charts digital preferences and behaviors of 2,800 millennial consumers (those between 18 and 34 years old) across the U.S., U.K., Germany, Hong Kong, Malaysia, Mexico and Brazil. It found more than a quarter of millennials don’t trust retailers or mobile wallet companies to handle their personal information correctly or securely and 13% distrust financial institutions.
U.S. and German millennials are among the most impatient in the world, the report shows. They’re more likely to use debit cards than their global counterparts and share an especially low tolerance for friction where sharing personal information is involved.
While smartphones are almost ubiquitous (97%) across all markets, U.S. consumers mainly use them for mobile banking and not for mobile payments. Just two-thirds of U.S. millennials worry about identity theft and data breaches; that rate jumps to 75% among millennials in the other markets.