Everybody knows the “traditional banking” industry faces not only challenges in some parts of its business model, FINTECS and technology companies try to take on the big old economy in many ways. As if it were not enough, regulators constantly increase burdens and make it even more difficult to extend margins.
However, the recent announcement to lift the regulation for “video verification” is a good example to fight back and it opens opportunities to:
- streamline processes and to reduce costs
- improve customer experience
- expand market share beyond traditional reach
First of all, video onboarding gives the opportunity to review the existing KYC process and to reduce non value add activities. The idea is to allocate the advisor’s time better on customer activities, such as sales. Moreover, the future outlook will be to rethink the traditional branch network. Hence, a scalable onboarding solution can help to shift efforts and reduce impact of a branch network reorganisation on market share. On the other hand, costs to manage the additional video onboarding process will initially occur, e.g. specific training, and it will also be necessary to scale up online onboarding to realise benefits.
The traditional onboarding requires face time of the client to existing opening times. An online process can help to create a positive response from users and can strengthen the perception of a bank to be “digital savvy”. It saves time and matches in an increasing convenience driven digital world. Additionally, responsiveness towards a customer request might make the difference when a client decides for an offer. On the contrary, if the process is not thought through, it might create a negative experience and could lead to frustration of the user/prospect. Hence, one of the focus area of such solutions should be the “digital journey” and to incorporate feedback around that journey via KPIs.
Expand market share
Furthermore, first learnings can be applied down the line in areas such as mortgage advice. The current process to get an appointment for mortgage advice can be a pain as resources are limited. Video onboarding might help here to scope discussions and balance the load, while keeping the experience at the same level.
The digitalisation of advisors is currently shaped by many trends, e.g. tablets, but only a few are able to really use the whole tool kit as it is simply unknown what type of problems can be solved with technology. Hence, little things such as video onboarding can help shape awareness and open their minds and hearts to really understand personal benefits of technology. However, new change also creates resistance and a need for communication which is nowadays a big hurdle for big organisations. Not many companies spent enough time and effort to take their employees on the journey of digitalisation, which can result in frustration and finally the exit of experienced and well educated staff.
When to act
As previously highlighted, the introduction of video onboarding shows many benefits. It improves convenience for people who are not able to visit a branch within its opening hours. Nevertheless there is no full digital experience, as a customer is still required to send physically signed paper documents to the branch. However, this might be soon replaced with e-signing. Hence, an early step by step introduction of parts of the process can ease implementation efforts and support a positive customer perception of the bank’s digital presence.
Competition/ first movers
Front runners such as UBS and LGT have already leveraged the opportunity to use the online onboarding as a chance to test potential benefits. Looking on a global scale, banks, e.g. Lloyds, have already announced services to include video advice and try to think of it as a useful tool in the overall customer experience.
Integrate service (process and landscape)
Video onboarding can be integrated as SaaS (Software as a Service) or fully fledged managed service. The tricky bit is to integrate the solution not as stand-alone, but rather in an ecosystem to reduce manual efforts.
In conclusion, the opportunities outnumber the risks and efforts to introduce such a solution and it will soon become normal to verify an account via video onboarding. The earlier you get onto such incremental digital changes, the better you can outrun your competition and be on the sunny side of being digital!
Find more information here.