I’m sharing a muffin and a cup of coffee with my five-year-old when, of all things, I overhear two adolescents at the next table chatting about banking. They are explicitly talking about their Revolut account and expressing their admiration for its features and overall customer experience (I’m paraphrasing a little).
One of the things they mention is how simple it is to create an account with Revolut, which I casually overhear while I eat my muffin.
This got me wondering: How crucial is it to be able to establish a relationship with a bank with just a swipe of your phone in the age of Instagram and Facebook immediate gratification?
How does a new generation value their “immediate gratification” from banking, who are not only technologically adept but also prone to continually compare it to services like Amazon?
Problem with Know-Your-Customer (KYC)
For a digital native, one of the most aggravating aspects of creating a bank account is the higher standard establish for establishing and maintaining your identity, especially when compare to virtually any other good or service you purchase. But this isn’t simply a problem for the typical millennial. According to research, 14% of businesses switched banks as a result of KYC verification and problems, and European banks spend $20 billion annually on KYC and anti-money-laundering regulatory compliance, seemingly with little result. There are a few approaches that can be utilize in tandem when onboarding a new customer to combine the best customer experience with meeting regulatory obligations.
Advice on how to balance regulatory compliance and user experience
Verification & digital ID:
It is possible to combine a variety of solutions, including Trulioo and Jumio, to automatically validate clients throughout their online experience. These can make use of a variety of techniques, including biometric facial recognition and selfie-base verification.
Uploading digital documents:
Where digital copies of identity documents are required, they are submitted and automatically authenticated, and the information is utilized to pre-populate the rest of the online application form. Combining AI approaches can also expand the number of approve document types and the straight-through success rates as the machine learns.
Integration of external data:
Using APIs connect to reliable external data sources, such as Ireland’s Companies Office or the Central Credit Register, to validate clients and confirm necessary regulatory information requirements
Negative media vetting
Banks can use internet vendor software to search through a variety of traditional and social media for negative references for the potential client.
Complexity requires human interaction.
In banking, it is more difficult to design a fully online journey that satisfies the demands and preferences of the consumer the more complicated the product and customer care. According to our research, banks must adopt a “phygital” strategy for complicated products, which fully integrates digital and physical channels.
According to a recent Financial Services Customer Survey, 63% of respondents stated it was crucial for them to open an account with a human advisor, and 59% said it was crucial for them to have access to human advisors in person for advice.
Give them immediate gratification and let them know if you can’t.
The last thing an online application should do is replicate the paper application process, whereby the applicant fills out the form, waits a week for a response from the bank, and then learns that the correct documentation was not submitted or that their credit application has been denied. Instant feedback is crucial whenever it is possible, whether it be through the use of tools like those mentioned above to validate customers online, the reuse of data where the customer has already provided it during previous interactions, improved credit scoring models with suitable credit policies to provide real-time credit approvals, or simply by validating each new piece of data that customers enter to reduce exceptions.
The game’s ultimate goal is to make opening a bank account for a customer as simple, intuitive, and enjoyable as possible.
Give the customer an easy digital method to interact with the bank and understand exactly where they are in the application process if it isn’t possible (and this especially applies to more complex items). The nCino business lending origination platform, for instance, provides a “customer portal” capability that enables customers to save and resume complex applications, communicate with the bank to send and receive digital documentation, grant access to other parties involved, and provide precise status information regarding where the loan is in the application process.
The game’s ultimate goal is to make opening a bank account for a customer as simple, intuitive, and enjoyable as possible. After assisting numerous banks worldwide in creating such experiences, we’ve discovered that the key component is putting the needs of the consumer at the center of everything.
There is one thing you can bet on: establishing a bank account will never be as simple as posting your newest Instagram picture. But even by the standards of the teenagers, I overheard in the coffee shop, I believe it will grow easier as customer-centric design becomes more commonplace and digital technologies evolve.
