Backbase presents

Customer Onboarding and Origination in Banking

Contents

00 _ Customer Onboarding and 03

Origination in Banking 01 _ How it looks now 04

02 _ Critical Ingredients for Digital Sales 08

03 _ Getting ready for digital onboarding 11

04 _ Backbase Omni-channel Onboarding 13

Summary and recommendations 15

About Backbase 16

Backbase presents

Customer Onboarding and Origination in Banking

Truly effective onboarding makes a new customer feel at home, from the outset. They need only input information on themselves once, the service they receive is uniform and uncomplicated at every contact point and they can easily apply for new products and services, on any device. For any bank wishing to grow customer acquisition, clever onboarding not only makes sense, it is essential in order to compete. A seamless, multi-channel digital onboarding process is also infinitely possible, yet for many banks and their customers this is not the status quo. Customer onboarding still involves cumbersome tasks such as form-filling, manual data input, or visiting a bank branch - tasks that today’s customers are less and less willing to undertake.

The current onboarding experience falls short of expectations for both banks and their customers, yet the market has become increasingly competitive. Whilst the reasons for this vary, falling behind will most likely lead to failure.

INTRODUCTION

Customer Onboarding and Origination in Banking

The vast majority of banks believe that by 2020 most of their sales operations will have shifted from their branches to digital channels, mostly web and mobile applications. This has major implications for how they do business. Strong digital sales capabilities and streamlined, end-to-end digital origination processes must play an integral role in any strategy. One-to-one targeted campaigns, microsegmentation, dynamic, tailored pricing and product bundling, third-party integration (e.g. with social networks), product white labelling, and distribution via aggregators - banks need to become good at all of it. Such capabilities are vital to support distinctive mobile and online offerings. It sounds like a lot of work, and it is, but delay is not really an option and banks that get it right will benefit in the long term.

In the short-term high-turnover products such as credit cards, loans and payments will most likely undergo the most rapid digital transformation. In fact, these are the areas most under attack from new digital entrants. Looking ahead, bank accounts and mortgages, which together drive over 50% of many banks’ revenues (and usually provide ‘sticky’ annuity streams), will be brought into the fray. Given this development, banks must carefully watch the evolution of their digital share and the success rate of digital products in the front book. The future replacement rate of lucrative annuity streams

will be increasingly dependent on digital sales and retention capabilities. In essence, it’s about securing the future and not being lulled into a false sense of security based on the back book.

What the bank’s customers wantVisits to bank branches have dropped significantly and basic transactions are increasingly handled online or via mobile devices. This reduces opportunities for face to face engagement and selling and makes online and mobile channels the chief branding and sales touch points. Despite this channel shift across all customer segments, banks and credit unions have been relatively slow to develop alternative selling strategies to leverage online and mobile channels.

The process of winning new customers and new business happens in a variety of ways. A consumer could begin their research on their home computer or tablet, they could walk into a branch seeking the best interest rate on a savings account, or the most flexible terms for a mortgage. They could be driven to a bank’s call centre via a number on the website, or fill in an online form to open an account. Whatever they decide, they expect a seamless, integrated onboarding experience. It is this experience that will determine how they feel about a bank and whether they actually follow through to become a customer.

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CHAPTER _ 01

How it looks now

More often than not, there’s a complex paper trail as new customers have their identity verified. Banks must put their customers through this in order to comply with regulations such as Know Your Customer (KYC). The rules are strict and usually require documents to be signed in person or sent via snail mail.

The information banks require to undertake due diligence and assess risk profiles comes from third-parties. This means they have to request data, wait for it, and then analyse it, which essentially derails the onboarding process as new customers must wait before taking the next step. Such lead time reduces the probability that they will stay with the bank until the end of the process.

Onboarding or new product origination is traditionally a challenging and time- consuming process. Barriers are created from the outset, which seriously impact on conversion rates and the cost of acquisition. This is even more so for banks targeting high net worth individuals, where the biggest barrier to winning business is that many new clients simply forget to “follow-up”.

These abandonment rates come as no surprise. The current set-up, filled with confusing, time-consuming procedures is demanding, both for banks and their potential customers. Manual processes, visiting bank branches, awaiting approval, and passing information through a series of systems consumes a lot of time. In addition to the very real risk of losing a customer along the way, it’s all quite a burden on the bank’s back end systems.

Paper-based processes

Waiting for information

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Form-filling costs time, for both customers and bank employees. Customers re-enter information they may have already provided via another channel. CSRs have to push this through, or input it into other systems. Human resources and a new customer’s time are wasted on unnecessary data entry. Customers must work to get their banking products, rather than being made feel welcome from the start. From both a customer acquisition and an operations perspective it

makes no sense - and there are huge opportunity costs. One bank that re-designed the experience for their customers saw an 80% reduction in the length of time it took to onboard and a 15% reduction in the cost of the overall process.2

Savings and increased revenues are clearly there for the taking, so what should banks be doing to take advantage of this?

Chapter _ 01 How it looks now

Human effort

Customer onboarding is clearly not as it should be and banks are losing out because of it.

iSky’s report “Business On-boarding with Australia’s Big Four Banks”, investigates what is

wrong with the traditional onboarding experience. Whilst it is based on Australia’s top four

banks, it reflects the experience everywhere.1

CSRs (customer service representatives) will fill out paperwork over the telephone with

remote customers and then email the forms to the customers for signature. This two step

process delays new account openings and causes customer drop off.

Customers must physically visit a branch to confirm their identity. For a remote customer,

the branch visit takes place on a future date and this step delays the new account onboarding

process. Further, the bank requires a branch visit to lift the outbound transaction restriction.

The longer this restriction is in place, the more frustrated customers become.

Asking a customer to go through multiple steps without CSR assistance brings barriers into

the onboarding process. The result is increased customer drop off and decreased new account

openings.

Customers can initiate the account opening process online; however the onboarding process

can only be completed with the signing of physical forms.

One bank sent far more physical mail to the customer, including two security devices and

separate physical mail for account information, cards, card PINs, online banking registration

information, and online banking password and setup information. Not only did the volume of

mail seem excessive, it was at times superfluous to requirements and confusing.

Remote customers are advised to visit a local branch which can be a difficult undertaking,

especially given that remote customers are often times out of town or out of the country.

Onboarding gone wrong

1

2

3

4

5

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Legacy Processes Cause Abandonment

Signatures or supporting documentation

What step(s) of the website application new checking account opening process must currently be handled in a branch?

74%

ID verification71%

Funding48%

Application31%

Other10%

Source: Digital Banking Report © September 2016 / The Financial Brand

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Legacy Processes Cause Abandonment

Source: Digital Banking Report © September 2016 / The Financial Brand

1 ”Business On-boarding with Australia’s Big Four Banks” iSky Research, July 2016 2 “Transform your bank’s operations model” Strategy & PWC, 2013

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With a clever onboarding process, both human and technological aspects are optimised and dove-

tailed to create the right experience every time. The smartphone is considered at every stage, data

is input once and information is accessible whenever it is needed.

Blend Human and Digital Experiences

Forrester uncovered a surprising statistic: millennials are just as likely to use bank branches as other

generations (50-55%). This demonstrates the importance of ensuring that your onboarding must

extend seamlessly across both in-person and online experiences.

Make Mobile the Hub of Your Onboarding Experiences

It’s no surprise that daily banking activities have increasingly shifted to digital channels, given the

fact that 56% of all website traffic is now coming from mobile devices. We expect the trend to

continue towards more research and applications being performed on mobile devices, which means

that your customer onboarding strategy should begin with mobile.

Transform Digital Customer Experiences

It’s clear that digital is increasingly the place where consumers will be interacting with banks and

financial institutions. In order to capitalize on this shift, it’s imperative that you either inspire or

facilitate a digital transformation within your organization.

Use Data to Differentiate and Personalize Experiences

Transforming the customer experience is not about moving everything to digital and forgetting

the branch experience entirely—it means leveraging data to better understand how your customers

want to receive information, and what channels work best for them for onboarding.

Stay Customer-Led not Technology-Led

Your consumers don’t care about your new back-end system—they just want a great user experience

and the ability to apply easily for your banking products….Take the time to understand the needs of your

customers and the capabilities of various software platforms, and plan a course for marrying the two.3

1

2

3

4

5

4%

16%13%

31%

Very successfulSuccessfulModerately successfulNot as successful as desiredToo soon to tell(n=285)

How would you categorize the successof your current onboarding program?

36%

Source: Digital Banking Report © October 2016 / The Financial Brand

Chapter _ 01 How it looks now

The current state of play is not a sustainable one, so why is onboarding so often below par? There are a few reasons, some of which banks may feel are beyond their control, yet the technology exists to overcome all of these hurdles and deliver integrated, seamless onboarding. The cumbersome nature of on-boarding is in part due to regulatory requirements and to the legacy systems that banks operate with. Overcoming these hurdles could

Customer onboarding comes under the auspices of various directives and pieces of legislation, such as the European Anti Money Laundering Directives (AMLD) and Know Your Customer (KYC) procedures. As part of due diligence, customers must be identified and verified. A range of checks must be put in place, and these often require hand-written signatures or face to face contact with a potential customer. Legal requirements, set by

In any onboarding process today, flexibility is key. Users must be allowed to become a bank’s customer whenever they want and on whatever device they want. The trouble for most banks is that this demands a new level of technological flexibility. Data needs to flow across open APIs, traversing systems, pre-populating form fields and providing bank personnel with a 360 degree view of a customer. Silos must be broken

seem an impossible task. Regulations are set by other bodies outside of their organisation. Replacing legacy systems and re-training staff drains a huge amount of resources. Improving onboarding is an overwhelming task and most banks will need to seek outside help in addressing these challenges.

outside organisations, are constantly changing. These are pretty much a non-negotiable fact of life and a bank must constantly navigate a sea of varying regulations. Different rules apply to different products and compliance is essential across the board. On the face of it, the regulatory side of things would seem to thwart any attempts to automate onboarding. It is however, a key driver of the need to do so.

down and the various functions of the bank must talk to each other in real-time. Huge legacy systems, by virtue of their design, often cannot plug into such an ecosystem. Technological support is required to bring all of the pieces together and deliver a unified onboarding experience. Banks cannot do it alone, so they need to be smart about seeking help to get them to where they need to be.

What’s going wrong?

Regulatory requirements

Legacy systems

5 steps to frictionless onboarding

Source: Digital Banking Report © October 2016 / The Financial Brand

3 “5 Steps to Creating Frictionless Customer Onboarding Experiences” Avoka February, 2017

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The perfect onboarding process - it’s already out there

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Cross Channel Customer Journeys

Cross Channel Journeys: Loan Application

Check Rates

Select Products

Apply

Get Help

Sign Contract

View Status

Onboarding can actually be done on a smartphone in a matter of 60 seconds. The traditional concept of onboarding is both outdated and unnecessary. In fact hand-written forms and drawn-out processes are no longer viable if a bank truly wants to win new customers.

With an omni-channel orchestration platform in place, banks can easily process applications that are started on one device and finished on another. For both bank and customer the process is seamless and uncomplicated as the platform unifies all of the bank’s channels. A new customer might, for example, begin an application for a current account on a mobile device and finish it on their desktop computer, or in one of the bank’s branches. The customer will pick up an application at the point they left it and CSRs should be able to see what stage they are at and if any help is needed. A central server that connects to each channel orchestrates the entire process, saving time, eliminating the need to duplicate information, and creating a positive customer experience.6

At the back-end, all digital applications can be processed quickly, as banks don’t need a human operative to tran-scribe a handwritten form. Instead, data flows straight

into the system, where a number of checks can be carried out. The checks verify identity, as well as whether the applicant qualifies for a particular product or service. These checks are done immediately, so the risk of losing the new customer drops substantially. Rather than stalling the process to facilitate approvals, the system lets users sign up and become a customer right away.

Step into the futureIt’s old news by now that the cumbersome Central Banking Systems (CBS) of the 1970’s have not kept pace with the movement to the cloud and the raft of new channels open to customers. In recent years, some banks tried to bridge the gap with expensive rebuilds, manual workarounds, and even mergers, but these approaches have also failed.7

The answer lies not necessarily in fixing what has gone before, but in engaging with the technologies of the future, which have automated each and every step of the onboarding process. With remote and real-time being the order of the day, banks wishing to compete will have to embrace big data, digital identities, biometrics and the power of the smartphone.

Chapter _ 01 How it looks now

Cross Channel Customer Journeys

The key to a seamless onboarding process is to put the customer at the forefront of its development and to harness the right technologies to support it. Banks that do so will reap the rewards in terms of brand perception and customer acquisition. A smart onboarding process will not only ensure a potential customer is more likely to sign up, they will feel more confident in the brand from the outset. Aside from boosting customer acquisition and retention, banks that get smart about onboarding can also cut costs - and substantially. McKinsey has calculated that banks and credit unions can realise 40-90% cost reductions through careful deployment of workflow tools and digital onboarding capabilities for customers and staff.4

In addition to removing compromises that the customer must make, onboarding done right brings a host of benefits. Aside from actually having a new customer at the end of the process, brand perception is solid from the outset, making it easier to upsell or cross-sell to them in the future. Due diligence and compliance cause far less headaches, and with the number of interactions greatly reduced, everyone saves time and money.

The benefits of an effective onboarding programme are clear, yet banks are not there yet, and they know it. In one study, over a third of banks surveyed considered their onboarding programme to be less successful than desired.5

How it should look

4 “The rise of the digital bank” McKinsey & Co, July 2014 5 “4 Reasons Onboarding Efforts Fail to Meet Bank Expectations” The Financial Brand, October 2016 6 “The Strategic Impact of Omni-Channel” Backbase May, 2017 7 “Overhauling banks’ IT systems” McKinsey & Co, March 2010

A cutting-edge onboarding/origination solution has a few key ingredients. To begin, a concerted strategy must be put in place, one that is designed to bring the various facets of the bank together to deliver the right UX. Once the business model is truly focussed on being connected, technology can take care of the rest. Banks with a good appreciation for the technologies available to them can take more informed steps towards smart, automated onboarding and origination. Developments such as mobile phone functionality, big data or dynamic forms save resources and make life easier by removing the need for outdated processes. More importantly, they free customers and staff from many of the compromises they must currently make, boosting acquisition and retention efforts.

CHAPTER _ 02

Critical Ingredients for Digital Sales

Smartphones already have all the technology required to make onboarding quick, easy and efficient. Just as a person can book a flight from the comfort of their sofa, they can easily sign up for banking products, using the tools available in their phone. Visiting a branch in person or passing documents from one place to another is actually no longer necessary. Biometrics can identify a customer and prove their identity as fingerprint and voice recognition technology works via the smartphone’s fingerprint reader and microphone. Indeed, many of us are already using biometrics, unlocking our phones with a fingerprint, rather than typing in a code. Some of the larger banks already offer their customers the option to use biometric technologies like fingerprints, voices or retina scans to access their accounts.8

Important documentation can be sent and verified digitally too. OCR (optical character recognition) technology helps to scan ID documents on the smartphone’s camera, such as passports and driving licences. With these technologies, identities are immediately verified and application forms are pre-populated for customers, making the entire process painless and efficient.

Mobile Onboarding

8 “The Biometric Future of Banking” The Financial Brand, October 2016

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the full process – and starting with high impact areas (quick wins), banks can significantly boost productivity and lower acquisition cost. German bank Number26 is a good example of how this is already happening. This bank offers a fully fledged bank account with MasterCard completely handled via the smartphone. Paper forms are replaced by mobile apps, video identification and intelligent algorithms to deliver fast, hassle-free onboarding.9

customers, boosting acquisition and retention rates. KYC offers many opportunities to enhance the customer journey and reduce duplication of effort.Pre-populated forms can be provided to customers, and their account profiles automatically completed. The bank’s staff get immediate visibility of up-to-date data, allowing for fast, accurate risk assessment,

approval decisions and simpler processes. The system can figure out which documents should be signed or provided at any particular point in the process. It can even go as far as making product recommendations.

With these KYC technologies, everything is checked, verified and signed off in real time. The customer has a positive onboarding experience, and the bank’s systems are simultaneously updated. By enabling straight-through processing – that is, automating and digitising

Know Your Customer (KYC) enables identification and verification to be performed once for a customer, and distributed on request and approval. Information relating to a customer is supplied on demand to different organisations so each bank no longer collects the same information. Aside from the time and cost savings, banks can provide a more frictionless experience to

Chapter _ 02 Critical Ingredients for Digital Sales

KYC - Know your Customer

from the end user’s perspective is that they input data once only. It is automatically saved so they can start completing a form and finish doing so later, even after switching channels (e.g. phone to desktop). This is the essence of omni-channel.

Dynamic, intelligent documentsNext to creating smart digital dialogs, ideally the same platform can be used to create dynamic, personalised and intelligent documents, which generate case-specific, relevant and personalised information. Quotations, contracts and confirmation letters can be shared in paper or digital formats and both digital and paper dialogues are handled with ease.

Better Business and IT CollaborationDynamic Forms solutions can also offer an efficient collaborative environment for both Business and IT specialists. Business teams can quickly design new forms, measure results, and make the appropriate updates and modifications, all without programming. IT specialists can configure the core forms engine and need only code display and integration logic once.

A Dynamic forms engine helps to model and streamline the interactive dialogs needed for digital sales and self-advice tools. It helps to create intelligent digital dialogs, and to design business rules and processes to route data inputs to the appropriate systems and people. Interactive forms can be designed and calculators or simulation tools incorporated to make all interaction with customers intuitive, user-friendly and efficient.

Rule-driven customer dialoguesWithout any programming, intelligent, rule-driven dialogues can be designed to create intuitive, user-friendly interactions. This puts customers in control and removes the need to answer unnecessary questions. It also ensures that expert help is provided where needed. All inputs are channelled to the appropriate systems and people within the organisation, powering a real-time 360 degree view of each customer.

Omni-Channel ReuseThe same dynamic form flows can be designed for use across multiple channels (e.g. online, mobile, call center) or devices (e.g. desktop, mobile, tablet, ATM). An open architecture allows for the flexible creation of reusable building blocks, such as field elements, validation rules, or back-end integration connectors. All are components of a modular design, and can be used for a variety of forms and channels. The end result

Dynamic Forms

Pre-utility state Post-utility state

Utility

Pre-utility state Post-utility state

Utility

Using a KYC utility helps eliminate duplicative KYC activities

Current situation• Significant process redundancy• Long wait turnaround times for new client acceptance• AML/KYC as one of many tasks• AML/KYC spending as a ‘cost’• Frequent regulatory oversight• Inconsistent AML/KYC standards• Marginal AML/KYC effectiveness

Utility vision• Economies of scale• Rapid new client acceptance• AML/KYC as core competency• Significant reduction in regulatory visits• Common AML/KYC standards• Optimal AML/KYC effectiveness

9 “Three of Europe’s most innovative banks are in Germany” Banknxt, March 2016

Source: “Share and share alike: Meeting compliance needs together with a KYC utility” PWC December 2015

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Digital Identities

Contributes to Company’s image

Increasescustomer loyalty

Simplified PolicyEndorsement

process

Valuable Channelto Cross-sell

Up-sell Products

Online CustomerSelf Service reduces

Labor Costs

Maximum flexibilityWith Dynamic Case Management, processes and decisions are represented by dynamic, rule-driven models. This ensures maximum flexibility and transparency. The main components of a process can be described in rules that determine which steps are permitted. Rather than having a series of prescribed rules, a case develops according to the specific situation surrounding it. A much more flexible and customised approach.

Improved efficiency and effectivenessComplex and long-term cases can be handled in a rule-driven manner, with rule specifications immediately executable. This paves the way for automatically processing multiple cases by means of Straight Through Processing (STP). Service delivery gains speed and quality, as knowledge workers are freed up to handle more complex cases. Automating such decisions also increases transparency and ensures compliance with applicable laws and regulations.

core systems gives prospects and customers a single point of of control, with access to everything they need. Within the self-service portal customer-centric dialogs can work on all devices and even know customers’ preferences per device.

Used to varying degrees throughout the world, new developments could see digital identities become increasingly ubiquitous. Already within the EU, new regulation called the Electronic Identification and Authentication Services regulation (or ‘eIDAS’) strives to establish a single legal framework for recognising electronic signatures and identities.11

A Self-Service Portal is the central cog that brings it all together. It provides secure access to private information and aggregates content and functionality from various back-end systems into a unified dashboard, which supports both customers and employees. The addition of a unified self-service portal on top of existing

Digital identities can help to reduce abandonment rates significantly by helping to make the process frictionless. A new customer need no longer walk into a bank to present identification, they can simply scan the relevant official identification into their smartphone. Scanning technology can capture a barcode or QR code from an official identity card, and this information flows immediately into the bank’s system.10

Chapter _ 02 Critical Ingredients for Digital Sales

Dynamic Case Management allows for the rapid, integrated and goal oriented handling of cases between knowledge workers, customers and other stakeholders. Collaboration is facilitated as everyone can access the same information. Decisions are transparent and always in line with the latest acceptance criteria and compliance rules. As complex processes and business rules become dynamic, automated, and less cumbersome, operations get much more efficient and customers are more satisfied.

Integrated customer viewDynamic Case Management connects data, processes and people to create an entirely integrated customer view, with complete, real-time information presented to all stakeholders in a user-friendly manner. With the same information available to all who require it, collaboration, efficiency and customer-friendliness increase.

Dynamic Case Management

Self-Service Portal

Digital Identities

10 “Digital identity key to making open banking frictionless” Finextra, June 2017 11 “The Future of Onboarding” PWC, December 2016

Instead of setting out to build the complete ‘perfect’ onboarding process, it makes sense to start small, create a strong foundation, and build from there. A well thought out, targeted approach will deliver more value and will prevent effort being wasted on the wrong things.12

It’s pretty clear that there is no time to waste with digital onboarding and origination, however before jumping in, some thought is required. Taking some time to document

which improvements will deliver the most value and how things will be done, will make the transformation a much more rewarding and long-lasting one.

CHAPTER _ 03

Getting ready for digital onboarding

Start small

“One European bank that went through a systematic mapping of its onboarding and origina-tion processes for automation potential found fewer than 10 processes that represented the bulk of its digital transformation ROI. In these targeted areas, the bank embarked on more radical investments, retiring old platforms, deploying new digital solutions, and reinventing the way the process works.”McKinsey & Co “The Rise of Digital Banking” July 2014

12 “21 Steps to Onboarding Success in Banking” Financial Brand, August 2014

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Go holistic

ExecutionThe digital transformation roadmap must have stakeholders who are accountable for execution and evolution with outcomes and metrics tied to everything.

Digital Transformation

takes an“Opposite Approach”

TechnologyInvest in technology infrastructurethat enables each pillar of the opposite approach to optimizecustomer and employee journeysand experiences.

Execution

Insights & IntentGather data and apply insights toadapt technology and customerexperience to stay relevant.

StructureForm a digital customer experience team with responsibilities clearly defined. The formation of a DCK team unites key stakeholders around a universal customerunderstanding.

The New Customer Experience

Technology

Insights & Intent

Structure

Objectives

Processes

People

Orientation

ObjectivesDefine what success looks like in the long and short term at the enterpriseand functional levels. Also define customer happiness and desiredexperiences.

OrientationSuccess begins with seeing people(customers and employees) differently,appreciating them for thier differencesand letting it all inspire vision and leadership.

PeopleUnderstand behavior, trends, values and expectations to reveal new opportunitiesto earn relevance.

ProcessesNew business models, org.charts and supportingprocesses systems and policies are written andrewritten to enable digital transformation

bringing everything together to create an ecosystem that connects all the parts of the bank and optimises the customer experience.

sign up? Does this change when they apply for a loan? Documentation should be kept in line with the requirements throughout the lifetime of a customer. This will simplify processes and reduce the burden on them as they reach out for new products and services.

As seen time and again with new CRM systems, a failure to consider processes before implementing new technology can lead to failure. With onboarding it’s no different and banks must consider each step of the process. What documents are required when customers

An integrated approach is vital. Digital onboarding is so much more than just bringing nice interfaces to the end customer. It spans the entire user experience and a host of back-end systems and procedures. This is about

Chapter _ 03 Getting ready for your Digital Transformation

Map the processes

Go holistic

“The good news is that virtually no financial institution has stopped an onboarding program once they have initiated the process. This is because the return on investment (even in the worst case scenario) is always positive, and many times has a return of 5:1, 10:1 and even 20:1 or higher.13

Digital onboarding, far from being an unwelcome task, is actually an opportunity not to be missed. The resulting growth in acquisition and the reduction in costs and attrition rates have been proven. In fact, banks that have taken a proactive approach have not looked back.

While the rewards are there for the taking, the pressure is also well and truly on. Customers, both new and existing, are used to booking flights, getting insured and buying pretty much anything at their own convenience and via their choice of channel. Challenger banks are disrupting the industry, using technology to transform onboarding, and making it easier than ever to become a customer.

Asking a new customer to just drop into a bank branch sounds easy, but this means they may need to take time off work, travel to another town, or change their schedule to accommodate. In a world where people are used to streamlined, simplified onboarding processes, this is simply too much to ask. For customers that actually make it through the current onboarding process, the bank has already missed an opportunity to impress them and gain their confidence. Banks need to get as far down the road as possible with planning for digital onboarding. Fortunately, it’s not a case of replacing all of their systems and starting over, a short cut exists in the form of getting the right technology partner. Fully mapping out the onboarding process, targeting key areas for improvement and incorporating clever solutions will kick-start the trans-formation and bring it all together – in a much shorter space of time than can be achieved in going it alone.

An overhaul is required, but not impossible. With proper planning, the right specialised support and targeted implementation, banks can transform and enrich onboarding – for good.

It’s not as impossible a task as it might seem either. Backbase has already created the software to connect the various banking silos and ensure that every customer experience delivers, every time. Their mission is to create integrated systems where disparate channels existed before and the following chapter outlines how this can be done.

The time is now

13 https://goo.gl/qxeBeP

Source: “Why Comcast And GM Need To Be More Like Netflix And Uber To Survive” VentureBeat July 2016

Today’s customers are using multiple devices and multiple channels to accomplish a task over time, and this is especially true when purchasing new

Backbase’s view is centred around omni-channel customer engagement orchestration. Yesterday’s onboarding solutions are quite fragmented and silo-ed.

CHAPTER _ 04

Backbase Omni-Channel Onboarding

Branch Internet Mobile

Touchpoints

Channel-specific processes Omni-channel processes

Screen design,workflows,

content

Screen design,workflows,

content

Screen design,workflows,

content

Branch Internet Mobile

Touchpoints

Screen design, workflows, content

Current Envisioned

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Various data stores with customer information Customer information accessible via APIs

Single view of the customer

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Single view of the customer

From Channel Islands to Omni-channel

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1 There needs to be low-friction, end-to-end business processes that work across all customer touchpoints. This means the customer sees a consistent experience, no matter which channel they use to make contact with the bank.

2Back-end systems need to be built on APIs with powerful configuration and product-defined features, so customers can execute any process through any channel.

3Banks ‘need’ an omni-channel journey orchestration capability that creates a single view of the customer and enables the customer to be served in the most efficient way possible, on any device.

products and services. The customer expects the same experience on every device and on every channel, and they expect to be able to perform a seamless handover between devices and channels.

To make this possible, banks have to move the flexible customer experience layer that runs independently from their core (legacy) systems and works across all touchpoints. There are three necessary components required to achieve this.

Dynamic Forms for improved interactionDynamic Forms Management (DFM) is Backbase’s 100% digital, paperless solution, which enables banks and insurance companies to accelerate the digitization of their business processes. It does so by cutting the number of steps required, reducing the number of documents and implementing automated decision making. This solution is also designed to work across all devices and platforms, empowering the bank’s customers and service representatives throughout the entire process.

The Backbase DFM supports the design of interactive forms, calculators and simulation tools. It helps to model and streamline intelligent, interactive dialogs and the processes behind digital sales and self-advice tools. This means that customer interactions are friendly and efficient, processes are de-tangled, and data is instantly available as and where needed – in short, transactions become experiences and this is a vital part of engaging customers.

Dynamic Case Management (DCM) for faster decision-makingSometimes, more complex processes are required. For example, with small business loans or mortgage applications, various individuals within the bank must sign off and a more complex workflow is called for, alongside dynamic case management. The Backbase Dynamic Case Management (DCM) is the engine behind such processes. It effectively takes over, letting applicants submit relevant information and documents, and subsequently streamlining the workflow within the bank. Collaboration between front and mid-office operatives is enhanced, which expedites operations and decision-making. The Backbase DCM supports all styles of case work and dynamically streamlines interactions between people, processes, data and content. Users not only get the information they need, they get it in the right context, which optimises operations, decision making and performance.

Re-useable building blocks for increased flexibilityBoth Backbase DFM and DCM are designed from an omni-channel, re-use perspective. As part of this, the same dynamic form flows can be re-used across multiple channels (e.g. online, mobile, call center, front-office) and devices (desktop, mobile, tablet, ATM, kiosk). Customers can now complete forms that are uniform and make sense. Data provided by end-users is saved automatically so customers can easily switch devices to complete a form in their own time. Field elements, validation and business rules, back-end integration connectors and presentation templates are the building blocks for true omni-channel. The modular design and open architecture of the Backbase solution means these building blocks are made once, then re-used. Creating and completing forms as part of onboarding has become easier than ever.

Straight Through Processing (STP) of cases brings speed and quality to service delivery and frees up knowledge workers time for more complex scenarios. The Backbase omni-channel solution powers STP, supporting the design of intelligent dialogues for intuitive interactions with customers. Bank personnel can assist where needed, customers need not re-enter the same information, data is automatically stored in the right place, and regulatory compliance is assured. This solution automates the entire flow end-to-end, yet retains many of the benefits of face-to-face interaction.

60 Second Onboarding concept Manual, paper-based onboarding processes are not only outdated, they are costly. In fact, they can cost up to 20 times more than computer-assisted, electronic document processing. Digital facilities are already available, but often merely as an online form rather than a real, engaging customer experience.

Backbase’s recently launched customer onboarding solution is the pinnacle of omni-channel engagement,

The Backbase Digital Onboarding & Origination Solution

Onboarding & Origination - End-2-End Capabilities

Package Solutions

Customer Employee

Dynamic Forms Management

Dynamic Case Management

Middleware / Core Systems / KYC / AML

LoansUSAEU

FLEX

MortgageUSAEU

FLEX

GenericUSAEU

FLEX

OnboardUSAEU

FLEX

Chapter _ 04 Backbase Omni-Channel Onboarding

Onboarding & Origination – End-2-End Capabilities

So how does technology make these ideal scenarios a reality? By taking a closer look at the Backbase origination solution, it’s possible to get some insight into the technological factors behind omni-channel success.

Paper-based processes, lead time and human effort are all part of parcel of the traditional onboarding and origination experience. Legacy, siloed systems and external regulatory requirements have played some role in preserving this way of working, yet with 60 second digital onboarding already available, it has already become a thing of the past. Abandonment rates and customer dissatisfaction resulting from the current setup are further proof of the the need to change.

On the surface, banks are trailing behind when it comes to digitized onboarding and origination, but on the flip side, there are many unexplored opportunities for them. In order to remain competitive in the future, banks will have to engage and learn fast. They could also opt to go beyond the minimum requirements, take things a step further and really delve into the opportunities an omni-channel banking solution brings. By doing so, they will accrue tangible increases in customer loyalty and retention.

New market entrants have surprised everyone by making onboarding and origination digital and hassle- free. Nimble fintechs aside, some banks have already taken steps in the right direction, and those who have already invested generally retain or even grow their omni-channel programmes.

With KYC data available on demand, and a host of technologies such as biometrics and OCR, the capabilities have never been better. Customers need no longer walk into a bank to sign up for products. Omni-channel banking software acts in an almost human capacity, with dynamic forms and case management handling many of the jobs that drain bank personnel time and frustrate customers.

While banks should not delay with starting their own omni-channel programmes, they should ensure they embark upon them in a clever way. Starting small, mapping out processes and seeing this as a part of

creating a holistic, customer-centric ecosystem are three crucial secrets to success.

KYC technologies, digital identities and biometric and scanning capabilities have already made it possible to apply for banking products within 60 seconds on a smartphone. Ignoring these technologies is not an option, banks must incorporate them into their UX delivery.

Above all, banks that keep their customer firmly in sight throughout this entire renewal process will win the day. Grappling with new technology could lead banks down a deployment-based path rather than a customer engagement one, an approach that will not work. Getting the right solution on board will ensure banks don’t lose sight of their customer or divert time and resources into the wrong things. The way to achieve this is to enlist the help of a specialised technology partner.

In essence, it’s time to find out what must be done, what can be done in-house and what banks need others to do. Once this has been mapped out, a solid foundation is already in place and banks can step into this new digital world with clarity and confidence.

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providing end-to-end onboarding in less than a minute. This solution combines flexible, open architecture with cutting-edge tools to make paperwork a thing of the past. It’s ‘latest mobile technology’ simplifies the Know Your Customer (KYC) process, speeding up approvals. In addition, optical character recognition (OCR) scans official documents (e.g. passports and credit cards), facial recognition confirms identities – and all data is relayed to the appropriate place on a bank’s system – all within seconds.

Aside from the amount of time saved by personnel, the impact on customer perception and loyalty is invaluable.

“You never get a second chance to make a good first impression – this is also valid with customer onboarding,” comments Jouk Pleiter, CEO of Backbase. “Onboarding is the first step that proves the kind of experience banks will offer to their customers. If not done right, it can kill the customer’s trust and ultimately, acquisition.”

Knowing what needs to be done is one thing, knowing how to delegate the tasks involved is another. Banks know their customers best, they just need to allow that knowledge to direct their efforts, whilst letting technology partners handle the automation piece. This will be the route to omni-channel success, now and in the future.

Summary and recommendations

About Backbase

Backbase is a fast-growing fintech software provider that empowers financial institutions to accelerate their digital transformation and effectively compete in a digital-first world.

We are proud to be the creators of the Backbase Omni-Channel Banking Platform, a state-of-the-art digital banking software solution that unifies data and functionality from traditional core systems and new fintech players into a seamless digital customer experience.

We give financials the speed and flexibility to create and manage seamless customer experiences across any device, and deliver measurable business results.

We believe that superior digital experiences are essential to staying relevant, and our software enables financials to rapidly grow their digital business. More than 90 large financials around the world have standardized on the Backbase platform to streamline their digital self-service and online sales operations across all digital touchpoints.

Our customer base includes ABN AMRO, Barclays, CheBanca!, Credit Suisse, Fidelity, Hapoalim, HDFC, Hiscox, ING, KeyBank, Legal & General, Al Rajhi Bank, NBAD, OTP, PZU, PostFinance, Societe Generale de Banque au Liban and Westpac.

Industry analysts Gartner, Forrester and Ovum recognize Backbase as an industry leader in terms of omni-channel banking platform capabilities, and award the company high marks for its deep focus on customer experience management and unparalleled speed of implementation.

Forrester names us a Leader in the Forrester Wave for Digital Banking Engagement Platforms, Q3 2017.

Backbase was founded in 2003, is privately funded, with headquarters in Amsterdam (HQ Global) and Atlanta (HQ Americas) and regional operations in London and Singapore.

Americas HQ10 10th Street, Suite 325Atlanta, GA 30309, United States Toll-Free Number: +1 866 800 8996 Office Number: +1 470 881 8780 sales-us@backbase.com

Regional Office London81 Farrington StreetLondon, EC4A 4BLUnited KingdomPhone: +44 20 3735 8437 sales-eu@backbase.com

European HQJacob Bontiusplaats 9 1018 LL Amsterdam The NetherlandsPhone: +31 20 465 8888 sales-eu@backbase.com

Regional Office Singapore3 Church StreetLevel 25 Samsung Hub Singapore 049483 sales-eu@backbase.com

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1Omni-channel: putting your end-customers first Today’s customers expect seamless customer

journeys – any time, any place, and on any device. The Backbase Digital Banking Platform (DBP) helps you to modernize and orchestrate all of your customer touchpoints, transforming multiple siloed banking channels and legacy applications into a consistent brand experience that’s easy to use and always available.

2Cost-efficient: reuse your core banking systems With Backbase, there’s no need to replace or rebuild

your core systems from scratch. Backbase enables you to repurpose them by incorporating their content, data, and functionality into a new digital customer experience layer. This layer is optimized for easy integration with your existing business applications, and the delivery of a unified and seamless customer experience across any device.

3Ready to go: jumpstart your digital transformation Backbase has developed out-of-the-box digital

banking solutions optimized for retail banking, commercial banking, wealth management and insurance-specific scenarios. Kickstart your project and dramatically decrease your time-to-market by leveraging industry best practices and ready-to-go implementation accelerators.

4Growth: control your digital strategy Backbase puts you in control of your digital

strategy, enabling you to create, manage, and optimize the end-to-end customer experience across every device. We have invested in many years of R&D to give you exactly the right editing and digital marketing tools you need to take full control of optimizing the customer experience, resulting in more sales conversions, and greater customer satisfaction.

Why is Backbase a leader in omni-channel digital banking?