This article was first published on Blog – Civic Technologies, Inc.
Digital and mobile banking have become the norm, rather than the exception. One survey of more than 5,000 consumers found that 69% wish to perform all their banking and financial actions through online and mobile channels. Consumers expect to be able to open an account, take out personal loans, transfer funds, and check their balance from any device, on-the-go.
In many areas – peer-to-peer transfer, instant check deposit, and virtual trading – banks have adapted well to the mobile consumer. But, there’s one area where traditional financial institutions still struggle to digitize: the new account opening and onboarding process.
Digital Account Opening (DAO) is the process of opening an account without ever stepping foot inside a bank. At its core, DAO must be able to perform the following steps:
- Collect a user’s basic personal identity information
- Evaluate and approve (or reject) applicants from a risk/fraud perspective
- Verify an account applicant’s identity
- Collect funds digitally in real-time, either through a debit/credit card or with mobile deposit
- Sync with an institution’s core banking system (CBS)
Today, banks are able to handle online account opening; but, mobile-optimized account opening capabilities lag behind. Here’s what some banks can do to close the gap and offer consumers the ability to open an account on any device.
What’s the incentive for banks to adopt DAO?
There are some very good reasons why banks are finding it difficult to introduce DAO on a widespread basis. Primarily, application fraud and strict “know your customer” (KYC) and anti-money laundering regulations present significant compliance concerns for banks.
A financial institution must positively verify a customer’s identity – many institutions aren’t equipped with the technology to perform this process yet, but there are incentives to make progress or risk missing out on the trend and becoming irrelevant. Organizations in ...
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Blog – Civic Technologies, Inc.