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Strong Customer Authentication threatens to impair CX, warns expert

Matt Cockayne, VP EMEA at Envestnet|Yodlee

Strong Customer Authentication (SCA) is threatening the unintended consequence of impoverishing the customer experience, an expert in banking software has claimed.

“While we’ve just celebrated Open Banking’s first birthday, there are still significant opportunities to create a frictionless consumer experience,” commented Matt Cockayne, VP EMEA at Envestnet|Yodlee. “While Open Banking was implemented to make lives easier, the inappropriate application of regulations such as incoming Strong Consumer Authentication on non-Open Banking accounts threatens to make the consumer experience much worse than it is today.”
The trouble, he said, stems from the fact that SCA regulations were only meant for payment accounts, yet banks are applying it across the board: “This unilateral application will mean that users will have to reauthenticate their information every time they want to do something on their account, leading consumers to take action counterintuitive to their security,” added Cockayne. “Furthermore, PSD2 demands that consumers sign in every 90 days to reauthenticate each AISP they granted access to their data. Essentially, SCA will make innovative tools born from Open Banking rigid and a hassle to use, when it should be easy, and consumers will walk away for applications that help them improve their financial wellbeing. Open Banking was made to create an environment where consumers could safely bank and look after their finances without worrying about security. The FCA recognises the problem and should take decisive, unambiguous action. It’s a serious issue that requires attention before consumers take matters into their own hands and risk their financial wellbeing.”

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