What makes customer onboarding in banking a journey and not a transaction?

Banking room of the Postal Bank headquarters on September 16, 2016. [Wilberforce Okwiri, Standard]

Until recently, opening a bank account meant having to go to a physical branch, meet in person with a bank representative and sign documents.

However, with customers increasingly adopting digital channels to interact and engage with businesses, this signals a new approach for banking where customers rely on different channels.

According to an analysis by global consultancy McKinsey, one of the productivity imperatives for African banks includes reconfiguring physical networks and shifting to digital channels.

Increasingly, traditional banks are forced to contact their customers through their preferred channels, such as SMS, WhatsApp or other social media networks.

Banks need to meet the needs of the modern consumer, and that starts with digital acquisition and customer onboarding. Starting with the initial application to open a bank account, banks must assess a customer’s application through a simplified and streamlined process.

This process should be clear, precise and capture customer details through their preferred channel. If anything changes, all details should be updated in real time to ensure a smooth customer experience.

The next step in the onboarding process is identity verification. Banks should leverage Know Your Customer (KYC) verifications, combined with application details to form an end-to-end view of the type of customer they are dealing with.

By using digital solutions such as photo and video call integration solutions to facilitate the enrollment of real people, underpinned by an enhanced verification layer of biometric facial recognition, the bank can respond to customer preferences. Once all customer analytics have been captured, predictive models based on customer behavioral data and artificial intelligence (AI)-based data should be used to make real-time decisions in terms of app approvals .

Based on validated data, KYC checks ensure that banks’ approval and decision-making processes are accurate and efficient. Potential fraudsters can be flagged early in the process, saving the bank time, money and damaging its reputation. According to McKinsey Growth and innovation in retail banking in Africa report, there are more banking customers in Africa who prefer digital banking services over branch banking.

Banks must therefore use digital solutions to ensure efficiency throughout the customer journey.

Digital signatures have replaced physically signed documents and one-time passwords are sent via mobile devices or email, simplifying the process and improving the customer experience.

The writer is the Key Account Manager at Infobip Kenya