Does Your Bank Have Abandonment Issues?
A good rule of thumb when trying to turn a potential customer into your customer is this: don’t make it an exercise in frustration to interact with your bank.
Today’s digitally savvy consumers are unlikely to have the patience to visit a branch, enter the same information repeatedly when switching between channels, or wait days for a loan or application approval. And the truth of the matter is, they don’t have to. Your competitors will be happy to take a frustrated customer off your hands.
Onboarding abandonment is a growing concern for financial institutions large and small. Surprisingly, however, many aren’t measuring the scope of the problem. For example, more than 50% of banks reportedly have no idea how many customers initiate an online application and then abandon the process. In a 2016 study of those financial institutions that do measure, 27% indicated that more than a quarter of their customers who began the online account opening process abandoned the process before completion.
So what makes these customers abandon the account opening process?
Quite often, the customer experience at many banks is not on par with customer expectations.
Consider the following findings from The Financial Brand’s 2017 Digital Banking Report Account Opening and Onboarding Benchmarking Study:
What customers expect:
- 46% of consumers use only digital channels for banking
- 60% of smartphone owners use mobile banking in some way
- 82% of 18 to 24-year-old smartphone owners use mobile banking as a primary banking channel
The experience financial institutions are providing:
- 48% of institutions surveyed indicated that the entire online account opening can be done without coming into the branch at all (a 5% increase from 2016)
- 66% of institutions surveyed indicated that they can open new checking accounts with online or website tools (a more than 15% increase from 2016)
- 18% of banks and credit unions surveyed indicated they offer mobile account opening (up 4% from 2016)
- 24% of banks that allow accounts to be opened via mobile allow the entire process (ID verification, funding, etc.) to be completed in this channel (31% said they intended to have this capability within one year)
It’s clear that although these numbers are going in the right direction, there is still progress to be made.
Building a Healthy, Long-Term Relationship with your Customers
From these responses, we can conclude that the foundation for a healthy relationship with your customers is built upon empowering your customers on their terms:
Make it Easy
Enable your customers to open an account in a single session by turning their smartphone into a mobile capture device. Don’t require signatures, documentation, ID verification or funding to be completed in a branch office.
Make it Fast
Automate identity checks for faster processing, while ensuring compliance with regulations such as Know Your Customer (KYC) and Customer Due Diligence (CDD).
Make it Engaging
Keep your customers informed with timely, personal communications via the method of their choice, whether that’s an email, a text, etc.
How Your Onboarding Process Measures Up
Find out how your onboarding process matches up with your customers’ expectations. This process assessment quiz will give you a snapshot of the strength of your organization’s current processes, along with valuable resources for transforming your onboarding.