Why onboarding is the key to fintech success

The challenge faced by every financial provider, including fintechs, is how to onboard customers as smoothly as possible. But what does best practice look like? 

In my experience, signing up for a new account can be an exercise in friction and frustration, not least because identity verification has been poorly implemented as an afterthought. A digital identification and verification process is central to a smooth and simple onboarding process and imperative for a digital bank or a fintech.

Capturing the address accurately is a vital step in ensuring you can match your new customer to their location. Using predictive address capture makes it simple for them to find their address and ensures the address is in the correct format for matching against the local address file.

If your identity verification process includes digital identity document capture, then there’s no need to ask the customer for their personal details; these can be retrieved from the document itself and presented to the customer for confirmation. Digital document capture also removes the need for customers to send in copies of identity documents; a process that irritates consumers, delays verification and is a costly overhead for businesses.

Creating a layered approach to verification via the active checks of identity documents and biometric facial images, combined with the passive checks of data, increases the referenceable datapoints; thereby raising the level of assurance for the identity.

No customer wants to spend ages signing-up for a new account and no business wants to lose a new customer just before they’ve completed their account opening. By providing a progress indicator the customer can see how close they are to completion.

Additionally, checking that the personal data captured matches the data required for a successful identity check, in terms of both content and format, increases the likelihood of a positive match and therefore the completion of a successful identity check.

Whilst friction can be a barrier to successfully onboarding customers, ‘friendly’ friction can give customers confidence and create trust. Plus, friction in the form of a ‘selfie’ can stop a fraudster who doesn’t want his face captured on camera.

Transparency with customers is also key. Always make it clear to a prospective customer what you are doing with their data, why they are being asked for their personal information and ensure they provide consent before they enter their personal data. For example, when undertaking an identity check, explain that by providing consent for their identity to be checked they are helping to protect the business and its customers from financial crime.

Ultimately, optimising your customer onboarding journey can make all the difference between acquiring new customers ready to use their new account and losing frustrated customers to your competitors because they found your sign-up process too painful. Plus, a successful identity check is an essential step in anti-money laundering compliance and the fight against fraud.