In a world where digital communication has become the norm, the concept of digital onboarding has proven to be a valuable constant for businesses. While face-to-face interactions are once again prevalent, digital onboarding remains a convenient and efficient process. Let’s delve into what digital onboarding is, how it operates, and why it might be the perfect solution for your business.
What is Digital Onboarding?
In essence, digital onboarding closely resembles traditional manual onboarding. It’s the process of verifying a new user’s identity before they can open an account with a service, but it’s done entirely online.
For many businesses, particularly financial institutions, customer onboarding is essential for Know-Your-Customer (KYC) compliance. Although the specific steps may vary from one company to another, they often involve form submissions, the provision of biometric data, and background checks. Implementing a digital onboarding process significantly enhances efficiency and convenience for both businesses and customers.
How Does Digital Onboarding Work?
Several key factors contribute to the digital onboarding process:
· Customer Data Submission: Depending on the company’s nature, the steps in the digital onboarding process may differ. For instance, digital onboarding in the banking sector may entail a more stringent process than in other industries. Typically, new customers submit images of their documents, while the system captures a facial image for verification.
· Data Verification: The system employs either AI, a KYC agent, or both to compare the customer’s submissions and confirm their accuracy. This verification process includes aspects such as spoofing, liveness detection, and other fraud prevention measures.
· Regulatory Compliance: After the customer successfully undergoes biometric verification, the system checks for additional regulatory requirements and conducts validity checks. For instance, it verifies documents against sanctions or PEP (Politically Exposed Persons) lists to assess the customer’s risk level and checks lost and stolen registries to ensure document ownership.
· Data Storage: In cases where government regulations necessitate it, companies can collect and store the provided data for additional requirements.
Types of Digital Onboarding
Digital customer onboarding provides various methods to accommodate the needs of different businesses:
· Automated Digital Onboarding Process: This is as simple as taking a photo. Users submit pictures of their documents and themselves, and the system takes care of the rest, ensuring a quick and easy customer experience.
· Assisted Digital Onboarding Process: This method maintains a real-time connection between businesses and customers. It involves a video call with a KYC agent for verification, with the customer only needing to display their document to the camera.
· NFC-Based Digital Onboarding Process: This online method uses NFC technology to instantly verify data, offering a highly secure identity verification procedure for those with NFC-compatible phones.
· Manual Digital Onboarding Process: This process allows KYC agents and customers to perform onboarding at their own convenience. Clients submit information online, which can be verified later.
The Benefits of Digital Onboarding and Automation
The lockdown period accelerated the adoption of online processes by approximately seven years. While this number is significant, it underscores the inevitability of procedures like automated digital onboarding. Let’s explore the reasons behind this trend and the benefits it brings:
· Eliminating Human Error: Human error is a natural occurrence, but AI can mitigate it. Factors like long working hours, stress, and fatigue, which can lead to mistakes in manual onboarding, do not affect automated processes, significantly reducing the potential for errors.
· Saving Resources: Digital identity verification proves cost-efficient by reducing unnecessary spending on human resources. The expenses related to hiring and training a KYC specialist team for on-site onboarding can be halved by trusting an automated system.
· Efficient Onboarding Flow: Manual onboarding often involves numerous touchpoints, including form filling, document printing, and manual identity verification, leading to critical time and effort consumption. Automated processing streamlines this experience, potentially reducing the onboarding time from months to days, resulting in a frictionless process.
· Data Organization and Storage: Digitally stored data doesn’t occupy physical space. In contrast, physical documents can be lost, damaged, or take hours to locate. Investing in an automated system relieves businesses of this data management burden.
Implementing Digital Onboarding
Digital identity verification represents the future of client onboarding. To remain competitive and ensure your customers have the most efficient onboarding experience, investing in digital onboarding solutions is essential. FACEKI is the ideal partner to help businesses identify their needs, implement the process, and adapt to changes seamlessly. Investing in an expert product simplifies customer acquisition like never before.
