The digital account opening slip ‘n slide

The conventional wisdom about first impressions is true, especially in digital channels. These digital first impressions are particularly tricky for financial institutions that are courting small businesses—because small business account opening is a somewhat asynchronous process that requires:

• document submission,
• know your customer procedures,
• identification proofing,
• credit checks, and
• signatures (potentially from multiple parties).

It’s extraordinarily rare that small-business owners will seek out online account opening, research their options, apply, navigate KYC and ID requirements, submit documentation, and fund their new account in a single online session. In fact, most business owners expect personal service or want a relationship manager to walk them through the process and ensure everything is done properly.

That said, FIs have a wealth of opportunities to streamline processes and reduce the friction of account onboarding with tools and workflows for the digital channel. Doing so also gives banks and credit unions the opportunity to introduce online and mobile solutions that their freshly onboarded business account holders can later use or purchase. Javelin Strategy & Research has observed up to 50% increases in usage of digital services when they are introduced immediately upon funding of an account. There is a high potential for increased profitability as well.

 

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