Modern banking customers expect to open a new bank account or savings account remotely utilizing their laptop or mobile device. According to special research published by BAI, three-quarters of millennials say they would switch banks for a better mobile experience, while Gen Xers’ willingness to use digital ways to create bank accounts for savings and loans is increasing.
As mobility advances, it is becoming increasingly important to provide a competitive onboarding process. According to Forbes, in 2021, over 80% of all financial institutions have introduced new technologies for generating or enhancing digital accounts.
Digital onboarding is a much-discussed ‘disruptive’ buzzword in the banking world, although it is more of a haze than a mist. The number of banks and customers who have adopted digital onboarding is low.
Banks and customers alike have tested the digital waters with much restrain and trepidation. Banks face challenges which are regulatory, technological, and business in nature. Now, let us analyze the friction points faced by customers in the onboarding process.
When we analyze the customer experience barometer, we find that onboarding experiences are decisive ‘make or break’ factors in being competitive differentiators. Lack of an efficient onboarding process which is time consuming has become the most common customer experience breakpoint in recent times. Customer loyalty and attrition are at an all time low during the first quarter of the onboarding process.
According to a Lightico survey, 40% of millennials who applied for a bank account dropped out during the onboarding process. They cited a lengthy, time-consuming verification process, as well as problems with paperwork, as reasons for abandoning the project. Customers will either go to another financial service provider or give up attempting to get that service through their bank if banks cannot provide a quick and simple mobile onboarding experience.
Though many incumbents traverse the ‘silk route’ of digital onboarding, there are still some pitfalls of manual intervention. For instance, the customer has to physically visit the branch for relatively inevitable reasons like ID verification and signatures. There is a stark disconnect between customer expectations and their actual experiences. Reports indicate that more customers would consider applying to these banks if the road laid for the onboarding journey traverses a 100% digital trajectory.
Since the customer onboarding processes on both online and mobile platforms require manual intervention, it becomes a sub optimal, time consuming process. The time taken for the onboarding process is like watching grass grow. Though the online onboarding processes take less than thirty minutes, the need for physical presence, or presentations of identity documents through branch visits, adds several days to the wait. And if the waiting customer is a business or owns a business, time is a key value proposition. Each day of wait is seen as an impediment to financial and business growth. The more often they have to come back, the less sense of urgency they have about becoming the bank’s customer.
Such semi digital offerings make the customer wait for days to complete the manual part of the onboarding process. Most incumbents do not offer a “Resume Later” option which allows the customer to continue where he left off. When a manual intervention like physical validation of ID cards or signatures become a mandate, it is imperative to have the “Resume Later” option. Also, a well-rounded Omni channel offering can reduce the bandwidth of an application capture. The lack of it implies, customers cannot work across devices at a later time.
Both the above challenges imply that the customer has to fill in the online details once again resulting in redundant data within a superfluous timeframe. Starting the whole digital process again is like a long walk in tight shoes. The painful journey doesn’t get you anywhere. This is a major customer experience breakpoint and drives serious attrition challenges to the banks.
There are companies which provide solutions to such posing challenges. For instance, Aspire has partnered with Temenos to provide digital customer onboarding solutions with a “Save and Resume” option. It is as supportive as a good recliner. One can recline on its Omni-channel maturity to ensure that he can self-onboard at his own pace, time and device.
Intrinsic challenges like regulations and internal inefficiencies, make banks take up to 3 months for a client onboarding practice. Add to that slower processing times and the inability to transact and onboard in multiple jurisdictions, time zones and repeatedly asking for the same data. Not to mention changing laws and regulatory compliances across geographies, which continually change with time. All this has made customer onboarding a difficult undertaking.
Remote customers are often expected to visit a branch. But they might face ominous transit challenges, besides being out of town or country. There have been brave attempts by banks to overcome these challenges. Customer service representatives fill out the paperwork for the customers through phone calls and then email the forms for signature. But this yet again is an insecure, cumbersome practice which delays new account openings, resulting in customer drop offs.
Digital onboarding is an opportunity not to be lured away. This acquisition, as well as the decrease in expenditures and attrition rates, have all been proven. Banks that have adopted a proactive attitude have had no negative consequences. Aspire provides banks with a lightning-fast client onboarding and origination solution to enhance customer acquisition through consultation and implementation services. Aspire’s one-of-a-kind ‘bot made bank‘ solution enables banks to complete client onboarding in under 5 minutes!!