As Apple Card pressures banks, a developer zeros in on mobile experience

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For banks and businesses to make a successful transformation to digital payment acceptance or account onboarding, they have to focus on the customer experience taking place on a mobile device.

And not enough of them are doing that, said Zviki Ben-Ishay, CEO of Lightico, a digital technology provider focusing on eliminating friction and making a customer's interaction with banks fast and secure.

Emphasizing the customer experience takes on even more meaning, as banks seek digital interaction with clients in the wake of the Apple Card launch, virtual business cards and similar products becoming more common

Lightico, based in Tel Aviv and New York City, says research from Kony indicates 68% of financial institutions and businesses undergoing digital transformations focus on the business process, such as what happens to a payment once it is received digitally from a customer. Only 28% place emphasis on the customer experience.

"We saw a big gap in the customer experience in payments, especially for enterprise businesses," Ben-Ishay said. "The experience is most powerful in payment documentation and identification of the customer."

As such, Lightico's technology also comes into play for financial institutions that have fallen behind in the digital transformation when it comes to onboarding customers into new accounts, said Richard Crone, chief executive of San Carlos, Calif.-based payments consulting firm Crone Consulting LLC.

"Consumers are still dragged through the mud with mobile payments and manual enrollments into new accounts," Crone said. "Authentication and validation for some businesses and the banking industry is based on the centuries-old thought that signatures are unique and identifiable — and they are not."

Because Lightico establishes a strong customer experience through a mobile phone, it takes on the role of multifactor authentication. The customer's cellphone number and, in most cases, biometric authentication into that device are already established, and the steps taken through Lightico simply strengthen the process with PCI-DSS and banking regulations compliance.

"Everyone in the economy is trying to personalize a payment or enrollment process, but you can't do that unless you know the customer," Crone added.

Essentially, the company wants to establish a digital experience with every aspect of a business operation. In that way, it is set up to operate in a multichannel environment in which faster communication with the customers is essential.

In that way, Lightico is emphasizing customer experience at the right time in payments because so many businesses and financial institutions will be seeking ways to accommodate digital processes, Crone said.

"The starting point is being able to open an account through a mobile device, so it's not really about what Lightico is doing today as much as it is about getting everyone prepared for when products like Apple Card are launched," he added.

Delivering a strong digital experience for the consumer will help banks augment voice, mobile account opening, instant issuance and credit features for products like Apple Card and others like it in the future, Crone said.

While Lightico does not share specific information about its financial institution or business customers, it did say it is currently serving "millions of customers" through more than 250 financial institutions, telcos and insurance companies. It is a demographic increasingly communicating with customers through digital communication, forms and transactions.

Through Lightico technology, a consumer making or receiving a payment from a bank or business receives a secured link via text message. The customer is prompted to take steps to document identity by providing a photo of a driver's license through a mobile prompt, read documents related to the payments, sign documents through the mobile phone and confirm a payment type.

The process takes minutes, compared to the several days it would take with paper documents. That time difference diminishes the chances of a customer abandoning the process, which 40% of consumers have done when enrolling in a bank account, according to Lightico data.

It is not a case in which the payments industry has dragged its feet to achieve better customer experiences, Ben-Ishay said. "Payments has been moving at the right pace, but because there are so many payment capabilities and standards out there, the businesses and vendors providing integrated payment solutions have to make sure the businesses have a way to get the payment from the consumer," he added.

Lightico does not operate as a payment processor or gateway. Its main focus is to get the payment capability accessible to a mobile device for any type of transaction.

"The biggest problem today is not collecting a payment, because nearly every person on the planet has a credit card, especially in the western world," Ben-Ishay said. "The problem was the interface is lacking to capture the credit card information in a safe manner and push it to the processor."

To that end, some Lightico business clients are accepting up to 150,000 transactions each month, and as many as 160,000 customers of those businesses are experiencing digital money transactions through Lightico prompts on a mobile phone.

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