As financial services continue adopting to the digital present and evolving for the future, the focus on building relationships through a customer-centric experience becomes more important every day.

In a prospective relationship, nothing is more important than the initial experience. A growing number of potential customers are engaging with a financial service company for the first time through a digital application process. This makes the initial experience a microcosm of the failings of legacy financial service companies during their digital transformation.

We reviewed current digital banking account opening experiences in the U.S. and found some troubling trends:

1. Digitizing the existing in-person process
Many organizations approach their digital transformations as simply digitizing their existing processes. This is a mistake. Digital technologies offer an opportunity to rethink processes and design experiences based on customers’ needs, wants and expectations. When an organization duplicates a paper form electronically, it fails to understand the power of digital.

2. Failing to design the experience around target customers
Even when organization appreciate that digital provides a clean slate, many ignore the ideal approach of building experiences around target customers. All new experiences should be grounded in the organization’s strategy, which should include a clear understanding of target customers. It should also include products that are designed for the process. Prompting customers to choose from all the possible products offered at the branch is a recipe for confusion.

3. Designing the process around outdated Know Your Customer standards
Complying with bank regulations and risk management are important considerations when building a new process. However, redesigning a process from the start is an opportunity for a bank to rethink its approach to compliance and risk management. Innovative organizations engage compliance and legal in defining new processes from the beginning, often resulting in better overall experiences.

4. Requiring customers to complete process outside digital
Mere digitization combined with legacy compliance can result in reversions to parts of the original process. Requiring customers to move from the digital channel they chose to use to a different one almost always results in a frustrating experience.

5. Pitting the digital channel against the physical channel
When banks design a digital process that will compete with an existing one, they must consider and address the project’s attribution at the start. Digital transformation should not be a project for “the digital team.” It should be an effort that cuts across, and involves, the entire organization. Designing a customer-centered experience should not take a back seat to turf wars.

6. Lacking success metrics specific for digital
Simply digitizing an existing process often results in relying on metrics that were applicable to the previous process. But new experiences require new metrics. One of the benefits of digital experiences over physical is the ability to capture data throughout the process, to optimize the experience.

7. Limiting choice in funding
Providing prospective customers with a single option for funding is another example of banks not thinking through the user’s experience. Some organizations shy away from certain type of transactions for funding, such as funding with a credit card, due to fraud concerns. While understandable, offering a few options should be considered, particularly if they include options to keep the customer within the digital channel.

8. Not allowing for exceptions
It is rare that a well-designed process produces only one or a binary result. In an ideal world every applicant would easily go through the process and be able to open an account without any issues. Of course, there are some applicants that aren’t a good fit and would select or opt out. However, there are some unforeseen reason why people aren’t able to complete a process, or are erroneously turned down. The most successful organizations provide tools to help applicants through the process and provide a “second chance” to those that fall out of the process.

9. Ignoring a follow-up process
For banks, getting a prospect to fully open an account is only half the battle. Ensuring the new customer starts using the account and thinks of your organization as primary is key. Many organizations have robust follow-up processes for accounts opened through physical channels, but fail to design similar processes for new digital customers.

Organizations should apply design thinking to their design of digital experiences. Such methodology puts the client at the center of new experiences, reducing the chance of making these mistakes.


Alex Jimenez