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    Challenges and Solutions of Digital Customer Onboarding in 2022

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    Businesses need to match the pace of technological innovations that are shaping their domains and setting up new standards.

    On one hand, this can be a boost for businesses, wherein they can leverage the tech-power to streamline their operations. 

    On the other hand, it can also be proved a roadblock if not understood properly before venturing into tech-enabled business solutions.

    Further, the changing consumer trends have further pushed businesses to adopt solutions that were unheard of a decade ago. One such new-age solution is digital customer onboarding.

    Customer onboarding, as you know it, is the most important part of any business operation. 

    How are businesses dealing with the digital procedure to onboard new costumes? 

    Is the new transition smooth and seamless? 

    Are there any challenges to it? 

    Is there scope to improve?

    In this article, we will analyze how digital customer onboarding has been so far. But before that let’s quickly understand what digital customer onboarding is.

    What is digital customer onboarding and how it works

    Digital customer onboarding refers to the process of acquiring new customers via the internet. 

    Since it’s digital, it does not take place at a branch or office premise. 

    Having a website or app is enough for this process.

    In digital onboarding, the users simply fill out the online signup form, providing their necessary details as prompted in the form in a step-by-step process. 

    An important point to remember is that the information provided by customers should comply with the regulatory frameworks of the region.

    Top 5 Challenges of digital customer onboarding

    For a few sectors, the online system of client onboarding is still in its early stage. While for some the technical transitions are still beyond understanding.

    For a few sectors, the online system of client onboarding is still in its early stage. While for some the technical transitions are still beyond understanding.  Therefore, possibilities of fraud, identity theft, and data tampering can not be ruled out entirely.

    Let’s take a look at the 5 major challenges of digital customer onboarding.

    1. Lengthy sign up process

    Most people don’t find it much of a problem to sign up for a site as long as they find it quick to fill. If the process takes longer than their patience level, they give up. Even asking for too much data can be problematic too.

    The whole point of digital onboarding is to minimize manual processes and unnecessary time waste. That is why customers prefer to provide information without a second thought. But the whole process should be hassle-free, quick, and seamless. Any deviation from this will lead to losing valuable leads.

    1. Fake identities

    Fraudsters make every effort to avoid linking their real-life identities to online aliases. 

    Going a step ahead, they even forge identities by using both actual and fraudulent information.

    Historically, financial institutions were the only organizations required to verify individual identities. Failing to verify the authenticity of the customers can lead to handing over money to crooks and scammers.

    However, as more organizations are offering financial services via online channels, scammers have developed creative means for dodging ID checks. They will utilize disposable or newly created emails and phone numbers for various schemes.

    1. Lack of technical upgradation

    Technology is moving fast. If you want to benefit from its potential power, you have to match the pace of innovation. This includes regular upgrades of the system and skill enhancement of the people operating it.

    You must have seen every online tool, software, and program go for upgrades from time to time. The tech companies go on removing bugs, shortcomings, and complexities from their products and software to keep it Avante-Garde. 

    The same goes for the software for the digital onboarding process. It has to be in its latest and most secure version to meet the requirements.

    Another aspect of regular updates is making the system more user-friendly. 

    Lack of upgradation will lead to customers experiencing the same difficulties repeatedly. That will not only lead to customer loss but also lead to a negative brand image.

    1. Lack of in-house resources

    The companies, building these digital onboarding tools, utilize the best minds and spend years on software development. And starting it from scratch with your limited technical resources might be too difficult to accomplish. 

    Even the cost of making such an app or software is high.

    Most companies prefer to outsource such tools to minimize cost. But outsourcing also has its own drawbacks. 

    One of them is the subscription charge which accumulates to be drastically high over the years. Another drawback is the time wasted in reaching out to their technical team in case you face technical glitches. That might put your whole operations at risk.

    1. High volume of customer abandonment

    Customer abandonment remains the most difficult challenge for banks and other companies opting for digital registration of new customers.  

    According to a Signicat survey of banking customers in Europe, the number of customers leaving their banking apps increased from 38% in 2019 to 63% in 2020.

    The possible reasons for such abandonment are many. But the initial difficulties in the registration process is one of the key reasons for that. 

    This is supported by another survey in the UK where the users have to click insane 70 to 120 times to open a digital bank account. Such a lengthy process will lead to a poor customer experience despite you having the best system for onboarding new users.

    Top Solutions of digital customer onboarding

    Delivering digital services needs to be well-thought and practical, keeping in mind that customer behavior is changing fast, you should deploy a process that shortens the time of completing the onboarding formalities.

    Let’s see some of the solutions that you can adopt to counter the challenges.

    1. Simplifying (and shortening) the sign up process

    What is the user’s initial engagement with your product? The registration.

    First impressions are really important. This sign-up process, particularly in SaaS organizations, assists potential consumers in improving the product experience. This initial encounter will set the tone for the rest of the product experience.

    Reduce the number of sections you require your users to fill out. Simply provide them with the necessary information and provide them easy access to the product.

    Some websites appear to have removed even the signup form. There is no need to join up and you may immediately search for the goods or service. You get the value right away.

    1. Provide some quick wins to new customers

    Another excellent practice for user onboarding is to provide quick wins the moment they join. The more value you offer at the beginning, the more likely your customers will remain loyal.  Product uptake and retention are more rapid.

    This is commonly referred to as the ‘wow’ moment, and it occurs when customers recognize the value of your offering. 

    You can employ Artificial Intelligence and Machine Learning to get more trends in your users’ behavior.  Discover the best strategies for maximizing the aha moments for your new customers.

    1. Set the onboarding flow correct 

    Customers who understand the value can pass on the chance to others. Creating onboarding flows can greatly aid in accelerating adoption. By offering customers customized onboarding routines, you encourage them to fully explore and comprehend the product.

    Customers that are confident in their ability to use your product efficiently and achieve favorable results may become advocates for your product. Having the proper onboarding flow in place may also greatly affect your client retention strategy.

    1. Provide customized user experience 

    Some people prefer a step-by-step onboarding procedure, while others like to get right in. 

    Allow users to skip the process if they are not interested in doing it right away in their first landing on your site. 

    However, surprisingly having such a skip option actually works for your benefit. Since the users don’t find your website annoying, they are more likely to return and even sign up later.

    It is critical to provide a positive client experience at all stages of their interaction with you. 

    The onboarding journey can be improved by tailoring it to the user’s age, gender, demography, and other factors. This is what defines your customer relationship to a large extent.

    1. Reduce friction 

    It’s critical to reduce friction as much as possible in order to acquire the right win. 

    From the customer’s standpoint, onboarding should be simple and painless. Customers may find it difficult to navigate the product if onboarding is not smooth. Many businesses overlook this when they first begin. But you should not be in that league.

    Instead of gathering all data at once, consider using progressive data profiling to acquire just relevant information. Don’t try to invade their privacy. 

    To achieve greater results, create a relationship based on mutual trust and value.

    Direct users to significant releases and features. Make certain that the product receives the attention you desire. The more you communicate about the value, the better your activation and onboarding will be.

    Conclusion

    Balancing both security and user experience is key in organizing the digital customer onboarding process. It’s obvious to grow your user base but don’t let fraudsters in the loop.

    To succeed, you need to be flexible and adaptable towards security tools deployed in your digital onboarding. 

    Also, you need to balance the light and severe KYC processes. In any way, KYC should be smooth and seamless for users.

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