The speed required by omnichannel commerce extends not only to payments and processing, but increasingly, also to vetting, registering and onboarding new users.
Given the growth of mobile commerce strategies that are designed to attract new customers in one channel and accept their payments in another, merchants and issuers risk quick abandonment if their capabilities don't measure up to their marketing.
"It's not just filling out a form and making sure it gets completed. The real definition of success is getting it up and funded and running in that user’s session," said Mark Schwanhausser, director of omnichannel financial services for Javelin Strategy & Research, which recently completed research linking effective onboarding to cross selling, retention and engagement for bill payment, cards and other financial services.
The need to manage authentication risk at the start of a relationship has increased as much as the need to improve the user experience at the opening of an account, said David Hultquist, vice president of industry solutions marketing at Kofax from Lexmark.
"There are new requirements, strict reviews, audits and new documents to be maintained," said Hultquist, adding that doesn’t meld easily with new consumer classes and apps' transaction needs.
"Consumer expectations are going up, whether you want to call it the mobile generation, or millennials," Hultquist said. "They're going to want immediate access regardless of whether it's an app or a store and there are two sides to that challenge—make the process more efficient and safe while considering these expectations on the consumer side."
Lexmark, a document management company, acquired document imaging provider Kofax in 2015 for about $1 billion to improve its onboarding technology for multichannel commerce. In the past, Kofax has worked with Visa to speed business-to-business payments automation; tied smartphone camera technology to gift card and marketing redemption; and provided document capture services for other financial services such as mortgage lending.
Lexmark leveraged its Kofax technology to build a new onboarding framework designed to power real-time decisions, authentication and verification. The framework, called Kofax Onboarding Agility, uses Kofax's omnicapture, process automation, case management, electronic signature and other technology to speed onboarding. The product also includes reference templates, configurable interfaces and document learning.
These components combine to render application forms which can be populated and reviewed "on the fly," tailored for a specific industry or type of user. After approval, these forms can be transferred to a core banking system or another back office document repository for record keeping, tracking, or enabling easier repeat access.
Writing in PaymentsSource about the balance between friction and security in onboarding, John Dancu, president and CEO of IDology, said businesses should be able to control the customer's onboarding experience, including identity verification and fraud prevention, and set rules that evaluate risk and escalate higher levels of verification when required.
Successful onboarding can also have benefits downstream. About 20% of consumers cite the hassle of transferring bill payment as a reason to not switch banks, according to Javelin. The research company also reports financial institutions that can convert 20% of consumers frustrated by difficult onboarding to bill payment and direct deposit can increase engagement enough to produce more than $200 per year in extra revenue per customer in bill payments and debit cards.
"It's not just getting an account opened, it's also getting it used," Schwanhausser said. "Onboarding is a particularly important state in setting up and deepening a relationship. The idea of opening up an account in a digital environment means you have to find another way to welcome customers and get them up and running."