Lessons learned and how to improve onboarding

We've been asking consumers about their onboarding experiences since 2016. As shown in this report, the results are not getting better over the years. With the world being more and more digitalised, you would expect more focus on the users and the user experience. But the abandonment rates keep going up, it takes longer than the users expect, and the experience is still painful for many users.

What is Onboarding? While many service providers may see onboarding as becoming a customer, most customers don't think the onboarding is completed until they have transferred their accounts, credit cards, and loans from their existing provider. In countries with a well working eID, you would assume it is not hard to become a customer. You sign up using your eID and can perform necessary background checks. But if transferring for example a loan requires a physical meet-up in a branch, people will be turned off and consider this a bad onboarding experience.

AML and KYC compliance An increasing number of businesses must comply with KYC practices (Know Your Customer) and AML regulations (the Anti Money Laundering directive). AML requires the service provider to perform:

  • A thorough identity check (is this a real person, and is this person present right now?)
  • A background check (where do the funds come from, and which business affiliations does the user have?)

Sometimes the user is required to provide more information. This is especially true in countries that do not have NIN (National Identity Number), making the above more complicated.

Explain WHY you collect information Service providers are generally not very good at explaining WHY they must collect a lot of information about users.

There is a big gap between “regular” online services and an AML regulated business. With regular online services, the only thing you need to provide is an email address and possibly a phone number. With services of an AML regulated business, you must fill out forms, upload your identity document, and take a selfie.

People are becoming more aware of data leaks and GDPR and are wary of sharing too much information, which is a reason for abandonment. Financial service providers need to be better at explaining the reasoning behind collecting all the information.

Manage -and meet- your customers' expectations to improve their user experience Service providers should also improve the user experience, especially by giving the user some indication up-front of what is required and how much time it takes. This will set the user expectation, and fewer people will consider the process painful. The last couple of years with the pandemic have boosted digitalisation. Video meetings and working from home, which used to be for a limited number of people, are now a commonality. People expect to do everything digitally, and they become more and more demanding regarding their user experience. This may be another reason for the increasing abandonment rates. The user experience has not become worse, but it has become a LOT harder to keep up with users' expectations. Primarily since regulations, solutions and expectations from customers differ per country.

What solutions should businesses consider to improve onboarding?

  • Do not reinvent the wheel, and don't be an identity provider. There are many trust service providers that can help you with your identity challenges, including Signicat.
  • Integrate with existing eIDs if available. This relieves you of worrying about KYC/AML processes that were already conducted while creating the eID either through a bank or public sector entity.
  • Manage and meet the expectations of your (international) customers
  • Where possible, give your (potential) customers a choice of different identification methods.
  • Integrate electronic signatures into your business processes. These electronic signatures are not only legally binding and more efficient but also more sustainable.
  • Keep your eyes open for technological developments such as decentralised identity and web 3.0. Let us know if you would like to learn more about this.

Schedule a chat with an identity expert to learn how we can solve your onboarding challenges

About the Battle to Onboard 2022 Report