Jumio white paper guides banks through how to upgrade onboarding experiences with biometrics

Onboarding with biometrics is the way to meet shifting consumer expectations, as the number of people opening bank accounts through websites and mobile apps has leaped by nearly half, from 22 percent in 2019 to 31 percent so far this year, according to a new white paper from Jumio.

The new white paper, “Remote Onboarding: How Banks are Changing the Game,” delves into banks efforts to address the sea-change they face with many customers who only banked in branches prior to being locked down now using digital channels.

While a small majority of new account openings in 2020 are conducted at a branch, 19 percent were completed online, and 12 percent through a mobile app, which is double the six percent rate at which apps were used for new accounts in 2019. This is a continuation of an established trend, and even from 2008 to 2016, the density of bank branches declined significantly.

“I think COVID-19 forced banks to re-examine and re-prioritize their digital transformation efforts.  I think many of them have gone online for checking account balances, pay bills online, transfer money between accounts, and doing more mobile banking. But, for many banks the remote onboarding was not fully digitized,” Jumio Vice President of Global Marketing Dean Nicolls told Biometric Update in an email. “This means you could start the process online, but the bank would force you to still come into a branch office to perform some function, like KYC checks.”

These banks are not being forced to complete the “last mile” of the process, but banks are traditionally not known for being nimble when asked to take on new processes. Ultimately, though those efforts have been expedited by the pandemic, according to Nicolls, it will likely take some banks months to catch up.

Jumio provides a list of five key questions for financial institutions to ask during the onboarding process, and explains how advanced technologies including 3D facial biometrics can be used to answer them. The company also compares in-branch and online onboarding processes, and assesses in-branch onboarding according to the criteria that current new customers use.

A section on advice for improved onboarding processes emphasizes improving the efficiency of interactions, such as by integration of identity verification and anti-money laundering (AML) checks.

Standing up advanced onboarding and authentication processes can be done in as little as two or three weeks, with the right buy-in from all levels, Nicolls says.

“What banks really need to think through is the user experience and not just cloning their in-branch experience,” he explains. “Banks need to wire frame and think through the entire digital journey — how many clicks, how many steps, are we using any jargon, are we explaining each step in sufficient detail, are we making any part of this too onerous for the customer? Once they have the key stakeholders on board, they’ve thought through the customer journey, then the rest of the process is fairly trivial.”

A shift in perspective may be necessary, however, as a lack of understanding about banks’ options for biometrics and eKYC remains in the industry, according to Nicolls. Many stakeholders would prefer to rely on inexpensive and fast pings of data-centric identity proofing systems, even though they do not offer the same degree of identity assurance.

“But,” Nicolls cautions, “increasingly biometrics is becoming more and more viable thanks to large scale data breaches, the growth of the dark web, and bot-based account takeover attacks. If banks are only protecting their customer’s accounts with a user name and password, they’ve most likely already been victimized by these types of attacks. Plus, consumers themselves are more familiar and comfortable with biometrics (especially face-based biometrics) and this will speed up the adoption curve.”

The new common business conditions are also challenging banks to adjust to emerging threat vectors, so Jumio offers a rundown. This includes less well-known scams like sleeper fraud, which can be combatted with biometric identity verification and behavioral analytics, and advice for thwarting the more-recognized but still difficult to detect synthetic identity fraud.

Ultimately, Jumio argues banks can close the gap in customer satisfaction with challenger banks, in part by beating them at their own game with fast, convenient onboarding experiences.

Article Topics

AML  |  banking  |  biometric liveness detection  |  biometrics  |  consumer adoption  |  digital identity  |  facial recognition  |  identity verification  |  KYC  |  remote authentication  |  white paper