July 22, 2019

Evolution of the Digital Banking Customer

Ten years ago, I started my career in “digital account opening”. I was working for a growing start-up that focused on helping banks and credit unions offer customers the ability to open deposit accounts online.

My roles have always been customer facing – project management, account management, solution architecture — in both management and individual contributor roles. In the early days, the profile and goals of the customer were much different than they are today. Since projected revenue from digital banking was low, banks and credit unions were hesitant to properly resource the teams working on these initiatives.

Digital teams (including those responsible for identity verification solutions) became dependent on borrowing mindshare and manpower from other teams whenever possible.

In 2009, the prevalent line of thinking around digital banking was:

• “Let’s get this thing live and see what happens”
• “O nly people who get declined at bank branches would open an account online”
• “W e’re not building our business on these customers, but we’re going to offer it so we appear to be forward thinking”

Accordingly, once the implementation was completed and the service launched, the project team moved on to another project without making adjustments to the user experience, decisioning approach, or overall strategy for months at a time. When teams did make adjustments, they struggled to obtain internal approvals as well as access to precious internal IT resources and Quality Assurance testers. Even worse, Customer Success professionals like myself were usually left to work with customers without a success plan or set of goals .

Tunnel Vision Workflow

I called this a “tunnel vision” approach-there was no vision beyond the implementation of the system nor was there any planning for the future being done. The only line of sight was the completion of the project or “the end of the tunnel”.

For example, some banks would complete the implementation of the workflow. But because there was an insufficient DOA (or no DOA at all), the project team lacked the authority to add the account opening button to the bank’s website. Unfortunately, it was an all-too-common practice for project teams to close out projects with critical details like these to be defined at a later date.

Fortunately, the situation is completely different today. These same companies which used to suffer from tunnel vision now have teams of data scientists and analysts, aggressive growth targets, and 18-24 month roadmaps outlining continuous tactical and strategic changes. They realize the only way to build a business at scale is through ongoing improvement of automated approvals, manual review reduction, and development of sophisticated fraud defenses.

Business outcome:

• Banks who previously had <3% of their overall origination being completed online are now performing at 15-25%
• Traditional banks and numerous digital banks are growing quickly gathering 100% of their customers through digital onboarding engagements.

Throughout my long history of customer engagements, which range from national banks to early stage start-ups, I can tell you that the most successful customers keep raising the bar and looking for partners that can help them gain an edge on the competition. So, remember, be bold and push back when you hear no – there are other teams who will find a way and it’s never easy to catch up.

Posted by

Jamie Verdi

Topics

Digital Onboarding