Biometrics has the power to cut down the slew of bureaucracy currently required for opening a bank account or starting to invest.
The simple act of opening a bank account has turned into a nightmare in recent years. Regulation requires several kinds of informed consent for using the account, credit cards, and internet banking features. Then you must add in the GDPR requirement, the KYC procedure for AML, CTF and FATCA purposes… And it’s not only the abbreviations that pile up quickly. If the process conforms to all the rules, it can take up to an hour. After that time, the client leaves with a bunch of papers he will most likely never read. No money has changed hands, and both sides may rightfully feel exhausted.
Biometrics Reduces Paperwork
This is true not only for banks, but also for other institutions with stringent requirements for identifying customers – from asset managers to telecom executives who are looking for ways how to make onboarding faster, less cumbersome and most importantly, leaving the customer feeling satisfied, not exhausted. Digital onboarding is almost the universal answer to the Gordian knot of regulations. According to several surveys, it’s also the number one priority for most financial and telecom operators in the coming years.
The demands on thoroughly identifying a customer remain. The most promising are fully automated biometric systems – easily scalable and deployable in new markets, combining the ability to perform ID checks and confirm the identity of the owner through a selfie and a liveness test that prevents spoofing a system with a photograph or a mask. Digital Onboarding Toolkit (DOT) by Innovatrics is one such system.
From Stranger to Customer in an Instant
Last year, DOT was successfully deployed by one of the biggest Slovak banks, Tatra banka. It allows a customer to open a new account almost instantly. Everything is performed directly through the app without anypaper documentation required. The client is even able to immediately draw a pre-approved loan through the newly-opened account. The automated ID check with liveness test bypasses the need for the confirmation video call that burdens other solutions, making them less scalable and not truly frictionless. The painless experience of opening digital accounts with other services leads to customers demanding as seamless a process as possible despite the requirements of the regulation.
Satisfaction Pays Off
Digital onboarding is currently the most sought-after solution among banks and telecom operators. For them, it’s a way to keep risks in check, costs down, and customer satisfaction high. With the coming of PSD2 directive (yes, yet another abbreviation), the competition in banking services will only get tougher, pushing for positive customer experience as a distinguishing factor. In fact, according to research made by Deloitte, 38 % of customers consider user experience of the banking app and onboarding process a make-or-break feature. And satisfaction pays off as well. According to a study by McKinsey, a one-point increase on a ten-point Net Promoter Score scale means an increase of revenue by 3 %. Fortunately, biometrics offers a natural approach to identifying customers without burdening them with bureaucracy.