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Customer onboarding - An opportunity to raise the bar of customer experience

'Customer is king" is an adage that assumes significance in banking and financial services. Financial services institutions must compete with peers to attract, convert and retain customers. Consequently, the customer experience is becoming a focus area. Customer onboarding is the first touch point to offer the customer a superior experience.

Customer onboarding is decisive since it has a direct bearing on the client engagement, customer servicing and customer relationship, which in turn contribute to the bottom line. Financial services companies must enhance their customer onboarding process to expand the geographical footprint, acquire new and robust business, and establish themselves.

The process of customer onboarding involves information gathering, due diligence, customer evaluation, and completing the set up. Some financial institutions have an elaborate process to collect as much information as possible so that they need not go back to the customer seeking more information. Collecting too much information or collecting little or incomplete information is not worthwhile. Financial services institutions must strike a balance by redefining their onboarding process. The optimal solution is to get the right volume of information in a short time span, thereby enabling a convenient customer experience. It must ensure that information is shared and made available for cross-sell and up-sell opportunities in the future.

Several banks have excelled in customer onboarding:

• Go Bank's welcome email to new customers is a case study in effective direct marketing
• Bank of America registers new customers for online banking during account opening at the branch. The bank issues a temporary password and directs the customer to the bank's website with an email.
• Bank of the West uses multiple channels to explore cross-sell opportunities while onboarding
• Chase measures onboarding by using a combination of channels, messages and offers

Customer onboarding must be a consistent, real-time experience across touch points. The process must adopt a relationship-centric view. The onboarding experience will determine the intensity of the customer relationship. Financial institutions must focus on onboarding to enhance engagement, retention and wallet share of customers. A study on the 'State of Marketing in US Retail Banking' revealed that 60% of respondents consider onboarding as a key strategy. Will it spur innovation in customer engagement?

Customer onboarding - Challenges and opportunities

Let us analyze how banks can transform challenges in customer onboarding into opportunities:


Focus area




Disparate onboarding processes requiring manual intervention


Banks must integrate onboarding process to avoid seeking the same customer information through diverse channels. It eliminates the need for multiple processes for different product lines and lines of business. Significantly, it helps communicate onboarding status to the customer at every point in the workflow.


Automation and digitization of the onboarding process minimize email communication, faxes and paper documents as well as manual intervention.


Process controls must be integrated with business workflows. Customers get frustrated when the bank has a different onboarding process for every country. Processes and sub-processes must be defined in line with onboarding needs across areas of business, products and countries. The workflows must adapt to business rules. The client onboarding portal must be linked to workflows and the business rules engine for easy client data validation.


Banks must account for differing local regulations, lengthy negotiations and documentation requirements.


Inability to determine the cost, time, effort, and productivity related to onboarding

Banks must strengthen the infrastructure used for onboarding in terms of cost, capacity, productivity, and operational efficiencies.


Customer onboarding is viewed as a back office function

Onboarding must be adequately funded by banks. Sufficient funding and efficient onboarding reduce attrition while increasing cross-sell opportunities. A survey of U.S.-based firms revealed that 70% of respondents viewed onboarding as a back office function, while 30% perceived it as a strategy to differentiate the bank from peers. 

Customer experience

Considered to be a routine activity

Banks should start viewing this function onboarding to create a competitive edge. The digital generation demands more convenience, better pricing and lesser face-to-face interaction. The older demographic seeks personal service and broader solutions to meet their lifestyle requirements. A consistent experience is imperative irrespective of the channels involved.


Onboarding must be a seamless process that can be initiated and completed across channels. The onboarding process must focus on operational efficiency. Process objectives, information and revenue earned must be shared among the teams involved.

Applications / systems

Absence of flexible / scalable platforms to onboard customers

Identifying different legacy systems, unifying similar tasks for client onboarding, and rationalizing activities help create a business process platform to deliver superior service.


Banks must optimize workflows across lines of business and product lines for better synchronization and automation. It accelerates onboarding cycles. It also enables a consistent user experience and contributes to operational efficiencies.


Absence of 'golden data' concept for client data

A unique client identifier used throughout the onboarding process flow ensures a 'golden source' of customer data. Accurate mapping between source and downstream systems minimizes manual rework and turnaround times. Significantly, it ensures smooth flow of consistent data, and traceability of customer data from source to destination.

Document management

Increased disclosures, controls and regulation lead to documentation overflow and complexity

Banks must define what is required, and compile a master list of document requirements for onboarding before contacting customers. Categorization of documents, indexing, and a document matrix simplify document management.


A rules engine for auto-identification of required documents and approvals, building document tagging and storage facility, and securing approvals and signatures in a consolidated process saves time and effort.

Is your customer onboarding program optimal and does it complement multichannel banking?

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