Wealth Management and Private Banking companies are making significant investments to attract new customers. The first real test comes during the customer onboarding process as this journey is the key to defining future customer relationships.

Most financial services firms struggle with the basics of their onboarding processes and are unable to set the tone for the right and profitable customer relationship. The solution as we see it is a fast, frictionless, and digital onboarding experience. Firms who are unable to onboard customers digitally today or in the near-future, will risk being outpaced by digital-first competitors.

Below are some of the key reasons why digital client onboarding has been at the forefront of digital transformation in financial services since 2020, and what drove those that have taken action.

Some Facts

• The traditional onboarding process can take up to 4-12 weeks and 5% of onboarding steps account for 50% of time and cost.
• A Deloitte research reveals that at least 38% of customers dropout of the onboarding process as a result of frustration with the sheer volume of touchpoints and paperwork involved. That’s 38% of your clients lost. No firm can afford to lose 38% of their potential revenue. Not to mention the cost in marketing and sales that goes into finding customers.
• Another research of 140 financial planning businesses, employing around 21,000 financial advisers, revealed that, financial advisers spend an average of 43 days a year with onboarding tasks that could be automated by technology. The manual onboarding tasks add an average of 13 hours to each new case. For bigger organisations, like wealth managers, adviser networks and banks, the lost opportunity can be huge.
• A survey from Forrester Consulting predicts that on average clients are contacted 10 times during the onboarding process and asked to submit between five and up to a hundred documents.

First Hand Experiences From Your Peers

Your industry peers across the globe also recognises the importance of digital onboarding and many of them are already seeing the benefits of digital onboarding for both themselves and their clients. Here is what they are saying about it:

• “The whole concept of end-to-end digital onboarding is powerful. Digital client onboarding was “a lot less sexy” than other wealth management technology developments, but it ranked high on advisors’ priority list.”
• “That’s probably the one thing that everybody emphatically agrees with: the onboarding process should not be as painful as it has been in the past. If an advisor can open an account digitally and instantly, “that’s ultimately going to make them look better.”
• “Our custodians started pushing digital onboarding about a year ago. Covid expedited that. Now we have shorter calls, usually about 45 minutes, versus longer face-to-face meetings we had before. Those might have lasted one-and-a-half hours.”
• “I think our onboarding has changed for the better. Signatures are faster because they’re sent digitally. And clients don’t have to drive to my office. That saves them time and saves them having to arrange day care.”

Unmet Expectations

Adopting digital onboarding is an urgent imperative but do you understand how it can help you resolve the disappointment of unmet expectations of key groups involved in the client onboarding process.

Customers’ Expectations

With customers seeking to place a premium on all things digital / omnichannel, they expect the onboarding to be straightforward, all paperless, and fastest. They often complain that the onboarding experience consists of numerous, cumbersome and dated forms with repetitive questions, signatures and too much back-and-forth on documents. Clients whose assets are spread across multiple institutions face additional steps if they want to transfer them, or even provide a degree of visibility to their advisors. Customers also expect their advisors to understand them on a personal level, offer products tailored to their specific needs and engage with them.

Advisors’ Expectations

Advisors find that the data entry process is manually slow, highly repetitive, disconnected, and siloed within the firm. They expect to be able to provide that optimal experience their clients are after. They want the firms’ support when they need it, and they want to spend less time on admin tasks and more time on selling.

Company Expectations

Firms expect advisors to provide accurate information about the client they are onboarding, which will help to reduce operational and compliance risks.

CONCLUSION

Today Digital Onboarding is talk of the town, and if you want to step up to the plate and fight against the client abandonment rates, missed revenue opportunities, customer and advisor dissatisfaction, it’s better to be a part of it.

Watch this video to learn how you can do that or speak to our experts at info@contemi.com

References:

• https://corporate-adviser.com/manual-onboarding-costs-advisers-43-days-a-year/
• https://www2.deloitte.com/content/dam/Deloitte/us/Documents/financial-services/us-cons-automation-in-on-boarding-and-ongoing-servicing-of-commercial-banking-clients.pdf
• https://modules.financialadvisoriq.com/c/2932493/359713/developing_mobile_tool_make_omnipresent_exec
• https://www.investors.com/financial-advisors/online-financial-advisor-onboarding-goes-virtual-pandemic/