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What Your Digital First Impression Tells Potential Customers

A lot rests on the onboarding process, but seeing customers through to the end, getting them approved in a compliant way, and successfully creating the relationship are by no means simple tasks. Add a diminished role of branch banking and increased push for digitalization to the mix, and getting onboarding right becomes even more crucial. Industry research from 2020 reflects this, with several recent studies demonstrating the level of frustration customers have with digital onboarding:

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consumers abandoned onboarding for a digital banking app in 2020.1are frustrated with inefficiencies in the onboarding process.3Onboarding is considered “difficult” by of surveyed Europeans, with saying the process takes longer than they would expect.2opening an online account because they thought it was too difficult or untrustworthy.463%73%26%28%Nearly halfof U.S. customers abandonedof North American customersof surveyed European

 

These statistics serve as confirmation of things we already know: onboarding is tough, customers are increasingly demanding a smooth experience and will abandon the process if they don’t get it, and widespread efforts to improve the process mean banks can’t afford to stick to the status quo — lest they be left behind. 

No industry exists in a vacuum, and banking is no different. As customers access more online services and become accustomed to a higher level of sophistication, online banking platforms may seem to lag behind. When you add in the need for due diligence to adhere to KYC/AML or jurisdiction-specific regulations, and there’s an additional layer of potential barriers that can hamper a smooth and intuitive user experience. 

Ultimately, banks that do onboarding right stand to gain as abandonment increases at other institutions. Since the online onboarding process is the most common first impression for customers, a lackluster experience can be costly. 

Let’s explore the good — and not so good — impressions customers can get from onboarding that impact the perception of your bank’s image at large:
 

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“I’m glad I can do this on my mobile. I always have it with me, which makes things more convenient.”“Wait, I can’t do this on my mobile phone? I wonder what else I can’t do on my mobile… This may not be the best bank for me.”There’s a sophisticated mobile-only onboarding option.There’s no mobile onboarding option.

 

We’re increasingly hearing that customers across age groups are starting to use their phones as much, or even more, than a desktop or laptop PC. Even users who predominately use their computer for banking will need some measure of account access on mobile thanks to the near ubiquity of smartphones. A smooth digital onboarding approach sends a clear message to customers: we’re a modern organization with the digital know-how to support your account management needs at home or on the go. The opposite message – that you’re inflexible, behind the times or inconvenient – isn’t one you want to send. 
 

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“I’m glad getting startedis simple. Maybe I should recommend this bankto my mom.”“How many stepsam I going have to complete? I don’t havetime for this.”Submitting information is simple.Submitting information is a long process.

 

While the recent health crisis has increased the incentive for online users, it is important to realize that some less-computer-literate customers may need more help to complete digital onboarding. Think easy-to-execute tasks, clear indications of where they are in the process, how much time they have left, etc. Behind the scenes, the system should be full of due-diligence checks, but the interface should stay simple. An easy-to-follow process gives customers the impression that you’re an organization that prioritizes their time, and that it will be simple to manage their account or sign up for additional services moving forward. Complex or difficult onboarding, on the other hand, gives customers who don’t abandon the process (because many will) an unfavorable glimpse of future experiences.

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“Wow, this is simplerthan I thought it would be! Their system seemspretty smart.”“This is my only ID. I don’t know what I’m going to do. Why isn’t it being recognized?”Capturing a government-issued photo ID is easy.The customer’s capture of their photo ID keeps getting rejected.

 

Warning! Abandonment hazard ahead. Submitting identity documents can be a major bottleneck in the onboarding process. If your process doesn’t clearly instruct the user how to submit their document or automate the capture to help the customer, then they may run into difficulties. If their document isn’t accepted, then they may simply choose to abandon the process. They may even spread word of their bad experience. Conversely, a system that easily facilitates submission of the ID document eliminates this bottleneck and makes for a frictionless experience. They’ll be impressed — and ready to keep moving along. 

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“I’m glad I didn’t needto submit anything else. Looks like they havea system in place tocheck everything.”“This seems excessive. Shouldn’t they be able to verify the info on their end? My other accounts didn’t make me do this.”Only one valid, government-issued photo ID is necessary. No other documents are needed.Customers need to submit or scan in multiple documents.

 

Compliance efforts can be detrimental to the customer experience if done clumsily. Making customers scan in or upload multiple documents isn’t just a hassle — it can be construed as unwelcoming. In many cases, customers may not have those documents on hand and may choose to abandon the process instead. Ideally, your system should be able to cross reference the customer’s information and ID with databases behind the scenes. Customers don’t know the regulatory landscape, and they shouldn’t have to. Show them you’re fully capable of vetting them quickly without making them shoulder part of the burden. 

 

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“That was quick! I’ll get this funded right away. Maybe I should look into their investment opportunities as well.”Customers are quickly notified of their approval and can get started right away.Customers have to wait a long time or receive notification outside the process.“Am I approved or not? Dothey even want my business? Maybe I should check aroundto see if there are anybetter options.”

 

When the time between completing the process and receiving notice of approval is too long, it disrupts the momentum of a customer’s desire to start using your products and services. This makes real-time approval a major opportunity for banks since customer momentum can be harnessed to expand their relationship right off the bat. They may be more receptive to prompts to fund accounts and see other services at the end of a rapid, smooth process. Starting off on the right foot by giving the impression that you’re eager and excited about the new customer is always a good idea. 

Looking to overhaul your customer onboarding process? It may be simpler than you think. HID Global® Identity Verification helps safeguard and streamline the process to minimize abandonment without sacrificing security. Thanks to a solution platform that offers seamless multi-factor authentication and fraud prevention options, HID has your digital user journey covered. Learn more about our end-to-end approach for consumer authentication.

Dean Stevenson is a Senior Security Consultant with significant experience within the field of IT, specializing in security for Identity and Access Management. He is also the Principal Pre-Sales Consultant for European, Middle Eastern and Sub-Saharan Africa regions. Dean has led many major security projects, enabled enterprise, financial services and government customers to meet their security and compliance requirements using the industry’s broadest range of identity assurance solutions.

References: 

1. “Six in Ten Europeans Abandon Digital Bank Applications during Onboarding.”
2. “Friction still plagues remote onboarding, financials turn to biometrics providers to help.”
3. “Identity Fraud Practices Used by North American Banks Risk Falling Behind in Digital Era.”
4. “AI-Fueled ID Verification Is Redefining Friction”

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