What Is Digital Onboarding?
Digital onboarding is also known as remote customer onboarding. Companies use this method to bring and set up new customers. This can be done electrically and remotely without the hassle of any paperwork. Customers can complete the onboarding process from their home only with safe online access, without going to the branch or office. This process collects important information about the clients, such as personal identification, and biometric information. It gives the customers access to the products and services from anywhere.
Types Of Onboarding
There are mainly three types of customer onboarding. These include:
On-site onboarding
This is the traditional method of onboarding. Here, the client has to visit the company or organisation in person to complete the documentation and identification process. They have to carry all the hard copies of the necessary documents along with them as well.
Semi on-site onboarding
In this method of onboarding, both online and offline processes are used in combination. Here, the client can complete electronic or digital documents from their home only, but they have to visit the branch office to submit them in person.
Digital onboarding
This method is completely digital. Here, the client does not have to visit the branch office in person. The entire process of documentation and identification can be done from their home or anywhere.
How Does The Digital Onboarding Process Work?
Digital onboarding follows all the steps of manual onboarding. The only difference is that everything is done online. There are typically three steps in this process, which are as follows:
Signing up
The first step is to create an account for the customer on the online platform of the company. Customers have to fill in some necessary information like name, email ID and phone number. This process of setting up an account takes only a few minutes. Whereas, visiting the branch and opening an account can take hours.
Identity verification
This step is the most important step that must follow the KYC procedure. KYC requires organisations to verify the customer’s identity before providing services to them. Identity verification is no longer limited to document authentication and biometric checks. Digital onboarding has increased the bar with facial liveness detection. They ask the customers to smile, move their face closer or further away from the camera, rotate their eyes, etc. These technologies help to ensure that the customer and their data are not fake and are being provided by a real living person. Financial institutions like banks can check the user profiles with government-backed databases and designated departments. They can also check anti-money laundering checklists to verify that the person performing the registration is not involved in any fraudulent activity.
Product setup
This step is very important as it introduces the customers to the service. They help the customers to learn how to use the service and can be implemented in a textual or even video form. Customers may tend to stop taking the services if they do not understand how to use them.
Benefits Of Digital Onboarding
Digital onboarding helps companies to gain new customers and retain the old ones. It is an important step to improve business processes and make customers happy. There are many benefits of using this method, which include:
Streamlines workflow
It offers customers quick access to application forms and document uploading. It simplifies the process of ID verification by allowing the uploading of IDs, photos and other data. This streamlines the workflow and aids in safely adding new customers much more quickly.
Improves customer experience
This process is customer-oriented, helping the customers to onboard from the comfort of their homes or anywhere. They do not have to visit the offices and spend much time there. It is convenient and a touch-free workflow, regarded as an additional safety measure in the post-pandemic time. This helps to boost customer experience and increase their loyalty to the company. They are more likely to use the different services of the company.
Saves time and cost
Digital onboarding saves the time of both customers and employees. It helps to automate many administrative tasks, such as filling in forms and verifying data. Thus, it cuts labour costs as you do not have to hire multiple employees for onboarding tasks. Thus, it reduces costs and uses the resources more efficiently.
Improves accuracy
It improves the accuracy of the whole onboarding process. It excludes the human factor, responsible for many errors. Digital forms detect incorrect responses quickly and they are resolved promptly. There are special ID document data parsing tools that can correctly identify the document type and fill in all the necessary information in the system.
Preserves conversion rates
This simplifies the onboarding journey for the customers and helps in maintaining higher conversion rates. New customers are more likely to complete their onboarding journey when it is quick and without any hassle. This helps the company to gain new customers in less time and also retain the existing customers.
Easy to comply
Digital onboarding is built with compliance measures like AML and KYC. This helps the companies to prevent violations and comply with government agencies and regulators. Companies will be able to avoid fines and penalties, adhering to the guidelines.
Increases security
This process uses encryption technologies and electronic signatures to protect the data of the customers. This helps to reduce the risk of fraud and data breaches. It makes confidential data more secure and customers feel safe to invest their money.
Related: How to Measure Customer Satisfaction
What Are The Best Practices For Digital Onboarding?
Businesses should ensure a smooth and less time-consuming digital onboarding process. Customers quickly abandon time-consuming and erroneous apps. These are the best practices for remote customer onboarding:
- Customers expect everything to be fully online, thus the process should be done completely digitally. There should be no hidden paperwork, no need to send documents by email and no visits to the branches.
- This process should use a technology that functions quickly and saves the time of the customers. They should help to verify the identity of the customer in real time.
- It should be operative 24/7 and available to the customers anytime and anywhere. These platforms should use technologies that can work in low-bandwidth and offline when there is no connectivity.
- Companies should use secure and safe solutions to prevent fraud. They should ensure complete confidentiality for the customer.
What Is Digital Onboarding In Banking?
The banking sector has seen a rise in digital onboarding during the pandemic and post-pandemic time. Banks are offering remote onboarding services that are completely online and mobile-friendly. Customers can sign up for a bank account or any other banking service from anywhere. This process also helps to complete the eKYC (electronic know your customer) of the customers, ensuring that the client is actually who they claim to be. It helps to prevent online identity fraud and makes banking more reliable and safe.
Related: New Hire Onboarding Checklist
What Are The Digital Onboarding Methods?
With the advancement of technology, more and more methods are emerging to make the digital onboarding process effective. The important methods are as follows:
Selfie verification
This process is quick and easy to use. The technology asks for a selfie of the person to match it with the photo on the government ID for better security. However, it needs proper lighting and good camera quality.
Document verification
It helps to accurately and efficiently verify the identity document. This can be done remotely. However, images of the documents should be clear and taken in proper light.
Liveness detection
The technology used for liveness detection adds a layer of security and is great for anti-spoofing. It can be done quickly and easily with a smartphone or device. It requires nicely lit space and a good quality camera.
Proof of address verification
This method provides a reliable verification of the customer’s address. It can be done remotely with the comfort of the customer from their home or anywhere.
NFC ID verification
This is the strongest verification option. It identifies the encrypted data in the chip to verify the user credibility. However, ID and NFC reader should be within a few centimetres of each other.
Related: New Employee Paperwork Checklist
The process of registering new clients is streamlined and expedited by digital onboarding. Utilising online resources to complete and validate forms gives your users a better overall experience. Digital onboarding is an important innovation for any firm since it lowers expenses and enhances security. Companies should thoroughly evaluate the technologies and pick the ones that suit their needs.
