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SECURE MESSAGING: A STRATEGIC ISSUE
E-mail has become the primary mode of business communication worldwide, but banks and other financial institutions have been limited in their ability to adopt it due to the sensitive nature of financial communications, and the need to protect themselves and their customers from theft. Secure messaging ? which encompasses instant messaging (IM) and live chat as well as e-mail ? removes these limits, giving banks that have adopted secure messaging a huge business advantage.
This paper presents the business case for secure messaging, which extends far beyond compliance issues. In fact, choices about when to implement secure messaging affect every aspect of banking. Banks that move quickly and aggressively to implement secure messaging ? particularly secure e-mail ? will have a powerful competitive advantage over those who don't.
E-mail has become so common that there is a tendency to forget the features that have caused it to dominate business communication in the first place:
- Speed
- Convenience
- A written record
When the use of e-mail is constrained due to security concerns, bank employees typically react in two ways: They use it anyway, opening the bank to substantial risks, including fines and lawsuits, or they simply work less efficiently, subjecting themselves and the bank's customers to significant inconveniences. The lack of secure e-mail also takes away one of the most successful marketing tactics to emerge in recent years. While e-mail marketing is often associated in people's minds with unwanted spam, the fact is that hundreds of highly-respected companies use opt-in e-mail marketing with great success to inform existing customers of new products, special offers and the like.
On a broader scale, any limits on electroniccommunication impose limits on the cost-cutting opportunities available to a financial institution. The most obvious opportunity is electronic delivery of notifications such as statements, buy and sell confirmations and the like. In this area, reduced printing and mailing alone can often justify the cost of secure messaging technology.
The point is that secure messaging is a strategic issue that merits the attention of senior management. Below are some of the areas where secure messaging has an impact.
CUSTOMER SERVICE
In the area of customer service, secure messaging provides a clear competitive advantage because it enables a bank to communicate time-sensitive information instantaneously, provides a simple response mechanism and, most important of all, presents information actively ? like a telephone call ? rather than passively ? like a web site.
Exception item processing is a typical time-sensitive process where secure e-mail vastly improves customer service. Non-sufficient funds notification is a good example. In a print-and-mail system, customers receive notification of non-sufficient funds well after the fact. The message is either, "We paid your check (and charged you $25.00!)" or "We returned your check," in which case the customer has to deal with the unpleasant consequences.
In contrast, with a secure e-mail system, customers receive notification in time to react ? by making a deposit, transferring funds from a different account or in some other way resolving the problem. Rather than being told what happened after the fact, the customer is presented with options.
Furthermore, these options can be presented ? and acted upon ? via the e-mail notification itself. For example, a customer can be offered the option of automatic funds transfers from a linked account to cover potential overdrafts in the future. And of course, notification of such a transfer would happen immediately via secure e-mail rather than appearing as a surprise on a monthly statement
The most important feature about e-mail presentment of exception items is that it's active. Exceptions by nature are unexpected events that usually require some type of action. Customers cannot be expected to check their account online to look for surprises. But they will check their e-mail on a regular basis.
In addition to event-triggered communications, secure e-mail can also be used in conjunction with batch-processed items, notably monthly statements. While the benefits of an "e-statement" are not as dramatic as those of an NSF notification, they are nonetheless significant to the growing number of individuals who simply want to make banking a computer-based activity. And, in contrast to online banking via a web site, no navigation is required with e-mail.
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