Digital payments users still struggle with trust issues

As more consumers make purchases through their favorite apps and online stores, trust remains a significant concern. Most users worldwide report having reduced or altered their use of payment platforms due to security concerns.

Chief among these concerns is the fear of account hacking, which ranks as the top barrier to trust according to a survey from Chubb on digital payments habits. This is closely followed by the possibility of a data breach.

These concerns are well-founded. Last year, consumers reported losing $1.86 billion to scams involving bank transfers and payments. Nearly two-thirds of respondents surveyed by Chubb said they have either been victims of fraud or know someone who has.

Users generally trust digital payment technologies, as evidenced by their growing adoption. Nevertheless, nearly one-third of respondents lack confidence in the security measures these platforms provide. Consumers expressed similar concerns about customer support and confidentiality.

If they fall victim to a scam, many users are unsure how to recover their lost funds. Nearly 40% reported they would not know what steps to take if a payment fails.

The Chubb survey also found that three in five users concerned about cyber scams have changed their behavior or reduced usage of certain platforms. Somewhat surprisingly, younger consumers are the most likely to adjust their payment habits. Despite this, 89% of this group said using digital payment platforms in the past 12 months.

A Profitable Cohort

The takeaway is not just that many consumers are avoiding  certain digital transaction platforms—it’s that those with high levels of digital engagement may be exactly the type of consumers financial institutions should target.

Separate data from Fiserv found that higher digital engagement among customers correlated with other positive behaviors, making  these customers more valuable to banks.

“The consumers that we consider highly digitally engaged were 29% more profitable than those that were not, which is a huge number,” Whitney Stewart Russell, President of Digital Solutions at Fiserv, told PaymentsJournal last year. “That same group had 48% higher balances.”