Behind Quontic Bank’s Data-Driven Approach To Faster Onboarding
Financial institutions (FIs) must continually focus on providing seamless and secure customer onboarding experiences.
Those with too-stringent authentication measures risk losing customers behind locked digital doors, while those with weak verification tools are holding those doors open for fraudsters.
FIs are out of options, however, as they have an obligation to create and maintain a balance that enables customers to securely complete onboarding processes without pushing them toward abandonment, Patrick Sells, chief innovation officer for digital-first FI Quontic Bank, said in a recent interview with PYMNTS. They must also keep up with digital banking innovations to ensure their platforms can both oust fraudsters — who often have access to equivalent technologies — and keep customers satisfied.
Quontic Bank recently upgraded its digital onboarding solution to that end, focusing further on identity verification and eliminating many common authentication and fraud protection friction points. The crucial change is not how it is authenticating these customers, Sells said, but the data it is now using to do so.
“That [onboarding] process at most banks takes eight, nine, 10 minutes and is slow and cumbersome,” he explained. “The process we [rolled out] takes about … three minutes. It is much easier for the consumer and much safer for the bank. The key to how we have been able to shorten that experience and process is by using data [regarding] who a customer is to verify [their identities].”
Seamless onboarding requires current data, Sells added. Making sure customers can authenticate quickly allows them to begin communicating with their banks and interacting with financial services as soon as possible. This is particularly important because consumers expect the same instant services from FIs that they receive from other businesses online.
The Problem of the Retail Experience
A large share of U.S. consumers quickly transact through digital and mobile channels, meaning they now expect banks to do the same — even at their first point of contact. FIs must thus be prepared to onboard potential users the way large-scale digital retailers would: in a few minutes and with minimal questioning.
Most FIs are well-acquainted with these expectations and are searching for technologies that can bring eCommerce-style onboarding to the financial space. Quontic Bank operates just one branch in New York City and pivoted to focus on its digital experiences approximately a year and a half ago. The decision largely involved abandoning its brick-and-mortar services, and the FI learned that creating retail-like experiences requires extensive and accurate data.
“Technology is an example in which we can use Big Data to create better experiences for customers, and you see that in our lives as consumers,” Sells said. “When we shop, we go online and Amazon knows exactly what we want. [It is] doing the same thing and using data to drive that experience, and that is one of the key things that we are doing: … using data that is available to us to not only make the experience of interacting with [us] better but also more intuitive and easier.”
Using alternative data streams such as geolocation, online shopping behavior or mobile app analytics is much easier after customers have already onboarded, but banks can also use them to help build out more detailed customer profiles and differentiate legitimate users from bad actors. Their access to this information during onboarding has been limited to keep that process as seamless as those of online retailers, however.
