Onboarding giving your customers a headache? Open banking is a painkiller you need

Issue 348 | 23 June 2022

Onboarding giving your customers a headache?

Earlier this week at the excellent Fintech North ‘future of payments’ conference I had a couple of conversations about the way Open Banking was disrupting the friction often experienced in on boarding clients.

Then ‘hey presto’ this piece from Salt Edge appeared in my inbox - I don’t have a connection with Salt Edge but given my conversations this week on Open Banking being an effective painkiller I thought I’d share……

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Just several years ago, an average customer onboarding process in financial institutions took about 24 days. And now just imagine, open banking can improve the onboarding process, so it takes several minutes instead of days!

According to Thomson Reuters

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Open Banking is a painkiller you need

The digital pace that our world took decades ago has been roughly accelerated by the pandemic that changed our life forever. Modern society is synonymous with speed, and this is especially true for financial services. And one of the most notable changes that is yet to be largely adopted relates to customer onboarding. You may ask, why is it so important? Customer onboarding is an integral element of almost any type of modern business, including banking, finance, lending, auditing, telecom, accounting, real estate, insurance, and literally any financial service and not only. To create a great first impression about your business and retain customers, it’s crucial to deliver an excellent client onboarding experience.

While starting to use a financial product, a contemporary consumer does not want to waste time on extra verifications, which can be highly cumbersome and exhausting. People look for an instant and effortless start and a fully digital experience without compromising the security of their data. Unfortunately, there is a huge gap between customer expectations and the reality of many businesses’ onboarding flows. Did you know that nearly 50% of customers abandon their attempt to sign up for new financial services within the retail banking industry? That’s almost half of your potential clients evaporating before your eyes. Why is this happening? Some recent surveys and studies show that people give up when the onboarding process takes too long. And the good news is that this issue is easily fixed with open banking.

According to Thomson Reuters, just several years ago, an average customer onboarding process in financial institutions took about 24 days. And now just imagine, open banking can improve the onboarding process, so it takes several minutes instead of days! With open banking businesses can onboard customers in just several clicks without having to ask a user to manually upload important information and documents. Bank account details and ownership could be checked in seconds and securely pre-filled helping to reduce drop-offs and drive customer engagement.

Client onboarding comprises multiple components of interacting with customers and can vary from business to business. Lending, insurance, banking, accounting, and other businesses dealing closely with onboarding issues, state that one of the most important components of an excellent onboarding experience, besides speed, is security. With open banking, the real-time data sourced directly from the user’s bank grants 100% protectionagainst account fraud and data falsification. Open banking technology improves the robustness of entry point fraud controls, in ensuring the bank account details submitted are legitimate and they link to the customer submitting the application.

The onboarding process automation helps businesses to increase operational efficiency and save time and money. But most importantly, by offering an outstanding user experience, businesses meet all the fast-paced needs of an increasingly digital world.

With Salt Edge open banking solutions businesses gain access to 5,000+ financial institutions globally to provide customers with a unique, effortless, and safe onboarding experience.

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About Salt Edge

Salt Edge – a financial API platform with PSD2 and open banking solutions. The company has two main vectors of activity: enabling third parties to get access to bank channels via a unified gateway, and developing the technology necessary for banks to become compliant with the directive’s requirements. ISO 27001 certified and AISP licensed under PSD2, the company employs the highest international security measures to ensure stable and reliable connections between financial institutions and their customers. The company is integrated with 5,000+ financial institutions in 50+ countries.

If you’d like to learn more about how Salt Edge can help you to improve your onboarding process and kit up your business with innovative open banking technology, request a demo today.

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