Onboarding

Customer onboarding technology: How FSIs should prepare for change

The OneID® Team

Customer onboarding is entering a newly tech-driven era of innovation. Driven by consumer appetites for seamless, touch-of-a-button digital experiences, FSI businesses are accelerating efforts to modernise how they sign up customers. But for financial service institutions to succeed, you’ll need to do more than just keep up with the latest industry trends. It's critical you understand the opportunities these emerging technologies can bring and how to embed them into your technology roadmap.

To help you on your way, you'll find insights and recommendations in this blog on:

Anticipating future customer onboarding trends
Embracing the shift towards disintermediation
Addressing the threat of big tech's entry to the FSI space

2024 and beyond: What's next for customer onboarding?

Recent years have seen a burst of technology innovations set to transform onboarding. But whether we're talking about open banking, automation or hyper-personalisation, each emerging solution points in the same direction: a frictionless digital experience for consumers that secures more conversions, lowers costs (especially relating to scams), and fuels business growth.

A superior UX interface can enhance conversion rates by up to 400% (Forrester)

Among these trends, those most likely to disrupt customer onboarding in the near future are:

Bank-verified data that reduces friction while enhancing security
Next-generation biometric and liveness checks
AI, machine learning and accelerated automation capability

While cryptocurrency, the metaverse and web 3.0 will have their part to play in the years to come, onboarding professionals should prioritise sign-up solutions that can demonstrate fast ROI, contribute to lower costs, and improve operational efficiency.

53% of FSI leaders believe an inadequate onboarding solution will inhibit growth, while 57% say it would lead to operational inefficiencies (OneID)

Bank-verified data – a critical part of open banking – shows particular promise. In Norway and Sweden, the "BankID" digital identity scheme - which has a 90% take-up rate among adults in Sweden - has already proven successful as a way to offer customers frictionless experiences, onboarding them securely in a matter of seconds by leveraging pre-authenticated personal information.

71% of Swedish adults say they preferred BankID verification to passwords (22%) or 2FA (7%) (Statista)

How should FSIs respond to disintermediation?

FSIs face intense competition from agile fintechs who have appealed to customers with mobile-first onboarding solutions. Though established financial institutions are catching up fast, a trend towards disintermediation - popular examples of which include Apple Pay, app-based banking and Bitcoin - will only continue.

To outperform digital-first challengers, FSI businesses will need to fight fire with fire. Customer demand for frictionless onboarding journeys has never been higher. So only a holistic, all-in-one solution will do - ideally one that can verify users, autofill their details and set up regular payments easily, all in a few seconds.

How to confront big tech's incursion into FSI

The question for FSI businesses is how to take advantage of what disintermediation has to offer, as well as counteracting its negative impacts. Doing so will take a multi-pronged onboarding strategy that:

Proactively engages with regulatory bodies
Invests in digital transformation initiatives
Prioritises frictionless solutions
Exceeds minimum requirements for compliance
Innovates with advanced digital identity verification

Adopting industry-leading onboarding technology

In our recent study – titled "How are leading FSIs disrupting the sign-up experience?" – industry leaders identified due diligence, customer data capture and account set-up as the biggest sources of friction to sign ups.

So your next customer onboarding solution will have to spin lots of plates. It will have to:

Adhere to regulatory requirements
Protect customers from scams
Streamline customer experience
Help cut costs via anti-fraud measures

To succeed, FSIs will need to embrace innovation by anticipating evolving trends and nimbly adopting technologies that help both customers and their business thrive.

Find out more about how 400+ FSI leaders are preparing for the future of onboarding and disrupting the status quo in our new report.