Survey captures business impact of banks, other online businesses that leave consumers unprotected online

SecureData, a member of the JSE-listed ERP.com Group and the distributor for RSA Security products in Sub-Saharan Africa, today announced that a survey just released by RSA Security showed that despite widespread fears of fraudulent activity and identity theft, consumers are willing to increase the amount of personal business they do online if their banks and other online service providers offer them strong authentication.

With nearly 50% of survey respondents indicating they would be more or much more likely to switch to a competitive service provider if that provider offered a strong authentication option and their current provider did not, and with more than two-thirds willing to migrate more of their transactions online if offered a hardware authenticator, consumers are laying down a stark business challenge for organisations that don't invest in appropriate identity protection for their customers.

The findings provide a telling counterpoint to a February 2005 RSA Security study that showed security concerns were perpetuating consumer reluctance to conduct personal business online; in that survey, nearly 25% of respondents were reducing their online shopping and 20% refused to work with their financial institutions over the Internet.

Although fears persist, this latest survey suggests that banks and other online service providers still have an open window of opportunity to build more online trust with consumers by providing strong authentication services that 'harden' traditional and weak password-based protection.

"Just when consumers were beginning to understand the required elements of secure electronic commerce, such as lock icons on their browsers, they have been plunged into the realisation that attackers are working hard to extract and exploit personal information," commented Trent Henry, Senior Analyst, Burton Group.

"Thus, simple measures are no longer enough to assuage their fears. As a result, enterprises are looking for ways to improve the technologies and processes used by customers in the online realm, both to rebuild trust and to reduce the likelihood of identity theft and related problems."

The survey results further suggest that the largest opportunity to build trust among consumers will come as organisations find ways to make strong authentication a familiar, convenient aspect of life online. When consumers were exposed to different personal security solutions, including strong authentication, firewall, and anti-virus, they exhibited similarly strong intent to purchase each solution, suggesting that authentication has reached the same stratum of necessity and familiarity as the two more clearly mainstream technologies. More tellingly, though, consumers eagerly embraced the notion of a networked authentication service that would allow them to use a single authentication device to access multiple sites and accounts; 40% more consumers were very likely to subscribe to such a network than were very likely to sign up for tokens that work on individual sites.

"Consumers clearly want to stay active online, but they have effectively thrown down the gauntlet for the banks, brokerages, Web e-mail services, auction sites, and myriad other businesses to whom they entrust their personal information," added Chris Young, vice-president of consumer authentication services at RSA Security.

"These account providers are therefore facing an extraordinary business opportunity. By offering hardware authenticators, they can up the volume of online transactions, thus increasing the lifetime value of their customers while reducing transaction and retention costs. There are also ample soft benefits, including greater customer satisfaction and trust and confidence in the company brand."

The study, commissioned by RSA Security and conducted by LightSpeed Research, was initiated to measure and understand consumer interest in online fraud protection through strong authentication and their willingness to adopt and pay for such a solution. More than 8 000 consumers fitting four online consumer profiles; online traders, online auction participants, online bankers, and Web portal/mail users; were asked a variety of questions to gauge how offering strong authentication in the form of individual hardware devices or a networked service concept would affect their attitudes and behaviours online. Benchmarks were provided by parallel queries into anti-virus and firewall products.

The study also asked about general consumer perceptions of online security threats. 82.7% of all respondents felt threatened or extremely threatened by identity theft, and 83.2% felt threatened or extremely threatened by online fraud. These fears extended at nearly identical levels across all types of online account holders, though Web mail and portal users showed the highest percentage of extreme concern. With regard to specific accounts, respondents were most concerned about fraudulent access to their online bank accounts.

"Given these security concerns even among the most ardent and sophisticated of online consumers, delivering stronger forms of protection against online account fraud must be a top priority," concluded Young. "Whether it's building a service that offers a single authentication method across multiple Web accounts, or providing a choice of easy-to-use devices that match a consumer's lifestyle and tech-savvy, businesses can no longer wait to educate and protect consumers online."

The 26-question survey, into online security concerns and consumers' willingness to adopt and pay for strong authentication, was conducted online with 8 198 respondents from 10 to 18 May 2005 by LightSpeed Research.