Digital onboarding: What it is and why a company should be doing it

Getting a customer into a system in a fast and secure way is best done by using customer digital onboarding. Find out what it is and why you might want to consider it.

These days, Know Your Customer (KYC) is an essential and required step in bringing customers into the organization. It is being used to stop fraud and also to hamper any would-be terrorists.

New customers need to be vetted for certain types of industries. Banks are the primary users who would benefit from a digital onboarding system since they have some strict requirements regarding KYC. Even insurance companies and investment firms should be using it. 

In this article, we will go over what digital onboarding encompasses and why a company should take it on. 

What is the process like?

Onboarding is the process of integrating a new customer into the database of a company. This will give them access to all the products or services they’ve paid for and the company offers. 

For the customer to access all of this, they need to be able to prove who they are and give some of their personal information and metrics. In the past, this would involve the customer going directly to the place of business and handing over the required forms and documents. 

The digital onboarding process is now done remotely and in a completely automated way. It can involve the client using their camera to set up facial recognition, or simply that they send their necessary information electronically. 

This speeds up the process immensely that brings a customer or client into the structure of the company. At the same time, they get the same guarantee of security as they would if they were doing everything in person. The company also gets the same guarantee that the person is who they say they are. 

How does identification work?

To get the same security that a face-to-face meeting would achieve, there needed to be the right technology. Luckily, technology has caught up and now there are several digital ways to prove one’s identity in a rapid and frictionless process. It is done completely remotely in a comfortable and accessible way that works well for both customers and companies. 

The platform the company uses can be developed in-house and feature the technical and user experience requirements they wish to have. Or, it can be done using third-party software that fits their requirements.

During the process, the client will need to upload certain identification such as a driver’s license or passport. For even higher security they may also be required to use a fingerprint or facial recognition to access the staff portal. This can be done on most smartphones using trusted systems. 

The key thing to keep in mind is that the process should be easily done by the customer. At the first sign of friction, they are likely to leave the platform and move on. They will face the same requirements from other companies, but if they find the onboarding process less burdensome elsewhere then they will go there. 

The benefits of using digital onboarding

To get the most out of this type of system there need to be some tangible benefits for the companies and customers. Luckily, there are several. 

Client-centric – A digital onboarding process makes things very easy on the customer. They can do the entire registration from the comfort of their own home and on their own time. Knowing the customers’ needs allows a platform to be created that features an easy-to-follow workflow to keep them engaged. 

Faster processing – Perhaps the biggest benefit to both the client and customer is the fact that the response is immediate when signing up. What used to take days previously now takes minutes. Having a lead become a client much faster is a big boon to a company. 

Less fraud – Fraud can cost companies millions so having a way to combat that is going to save a lot of money. Fraud is a serious threat both to the accounting ledger of a business but also to the safety of citizens. Fraudulent customers could be using their money for activities that are illegal. 

High standards – A robust platform will recognize documents from all over the world and be able to verify the veracity of the user. This allows for very high standards for a system that is secure while being straightforward. 

Could digital onboarding be right for you?

Although companies still need to be concerned about fraud and the security of their system, it is easier than ever thanks to the digital onboarding process. It has been a big benefit to both clients and companies.