{"id":1510,"date":"2019-09-25T12:00:47","date_gmt":"2019-09-25T12:00:47","guid":{"rendered":"https:\/\/www.cloudnowtech.com\/blog\/?p=1510"},"modified":"2021-08-17T07:19:58","modified_gmt":"2021-08-17T07:19:58","slug":"importance-and-benefits-of-digital-merchant-onboarding-in-banking-sector","status":"publish","type":"post","link":"https:\/\/www.cloudnowtech.com\/blog\/importance-and-benefits-of-digital-merchant-onboarding-in-banking-sector\/","title":{"rendered":"Deliver a Superior Customer Experience through Fast and Simple Onboarding"},"content":{"rendered":"

The importance of digital onboarding<\/span><\/h1>\n

As the digital era continues to progress, modern customers expect ever faster and easier delivery of products and services. And in a world where the customer is king, every industry has no alternative but to embrace the digital revolution.<\/span><\/p>\n

The financial sector is no exception – online transactions, automated payments, and mobile management of accounts are just a few examples of digitization in the industry. But most banks are still missing out on one area – digital onboarding<\/a>.<\/span><\/p>\n

Onboarding is the very first step a bank takes with a customer – the various digital services a bank will offer for the customer\u2019s convenience will only come after this important first stage in the journey. With competition increasing almost on a daily basis, it is important that a bank or financial institution offers a digital experience from this very first step.<\/span><\/p>\n

Onboarding challenges faced by financial institutions<\/span><\/h3>\n
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  1. The typical bank onboarding requires far too much manual processing. Physical forms require time and dedicated effort to fill, and errors can result in needing to fill out a new form a second time. A digital onboarding process, on the other hand, offers a great deal of flexibility.<\/span><\/li>\n
  2. In addition to the need to fill up extensive forms, customers are also expected to submit a number of physical documents – which only adds to the hassle. Most often, customers are too overwhelmed by the sheer amount of paperwork and tend to give up sooner than later. They are bound to find other institutions that allow for faster and easier processing, preferably online.<\/span><\/li>\n
  3. To remain compliant, banks and other financial institutions need to ask for a certain amount of information and collect a certain number of documents – but an online platform could provide autofill options so users do not have to keep rewriting the same name, address or other details more than once.<\/span><\/li>\n
  4. It\u2019s not just for customers – having piles of papers to process is a major challenge for financial institutions too. The process takes weeks to complete – adding to customer frustration – or requires a number of backend personnel to complete on time. Either way, offline onboarding is a costly affair.<\/span><\/li>\n
  5. The lack of digital onboarding may also mean that the financial institution is missing out on digitally native millennials. With a large chunk of this population already in the workforce, a financial institution must definitely look at ways of adding them to their clientele.<\/span><\/li>\n
  6. Digital onboarding processes can be fitted with smart analytics features that capture customer behavior. This information can then be assessed to make improvements to the overall onboarding process. On the other hand, offline onboarding processes have limited scope for improvement.<\/span><\/li>\n<\/ol>\n

    Digital solutions to address onboarding challenges<\/span><\/h3>\n

    Intuitive UI and UX<\/b><\/p>\n

    Walking customers through the registration process with large icons and easy-to-digest content, helping them move from one step to another seamlessly without having to enter the same information multiple times, and giving customers the flexibility to come back at a later time and continue filling an unfinished application – these are all ways to boost convenience and minimize the number of dropouts.<\/span><\/p>\n

    AI and Automation<\/b><\/p>\n

    Are customers lingering too long on a page or having trouble with completing a step? A chatbot can step in and offer a friendly tip or ask if assistance is required. In addition to bringing down the possibility of dropping out and increasing customer satisfaction, chatbots have been estimated to save over <\/span>$174 billion<\/span><\/a> across industries annually.<\/span><\/p>\n

    Automated email nudges that reach out to customers who didn\u2019t complete the onboarding process, and emails that ask for feedback from customers who have opted to bank elsewhere, are also simple, yet effective techniques.<\/span><\/p>\n

    Digital KYC<\/b><\/p>\n

    The most challenging step in the onboarding process is the KYC (Know Your Customer) which requires validation of customer details.<\/span><\/p>\n

    Even this can be digitally enabled or made flexible enough to suit customers\u2019 convenience. Emerging trends include video verification, verification at home, or verification through a nearby convenience store and not necessarily the nearest branch of the bank itself.<\/span><\/p>\n

    Business benefits of digital onboarding solutions<\/span><\/h3>\n