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Transformative AI in the Banking Industry
Once in a while, transformative technology thoroughly shakes up business foundations. The internet was one of these global game-changers, and now Artificial Intelligence (AI) is gearing up to do the same. With rising customer expectations and needs, AI can help the banking industry retain and attract clients in an increasingly competitive world. You might be wondering how? What does the technology mean for the customer experience and the banks themselves? And what’s standing in the way of a full breakthrough? Read on as we attempt to answer these questions. Customer Service in the Banking Industry Customer needs are continuously changing. They conduct extensive online research and expect personalised financial advice. They want banks to understand their needs and provide tailored solutions. However, traditional banks often struggle to keep up with these expectations due to their reliance on manual processes and outdated systems. Getting to know your customers takes time—something that most banks and their employees don’t have because they’re bogged down with administrative tasks such as managing incoming mail or processing loan applications. With the advent of AI, banks can now personalise customer interactions more than ever before. AI technologies enable banks to analyse vast customer data to gain insights into individual preferences, behaviours, and needs. This allows for tailored recommendations, proactive support, and customised financial advice, enhancing the overall customer experience. AI-powered chatbots and virtual assistants provide instant, 24/7 support, handling routine inquiries and transactions efficiently while freeing up human agents to focus on more complex issues. Additionally, AI-driven fraud detection systems safeguard customer accounts in real time, offering enhanced security. By leveraging AI, banks can deliver more relevant, timely, and secure services, building stronger customer relationships. AI in Banking According to Deloitte’s research, 76 percent of chief experience officers within the finance industry believe that AI is a tool for differentiation. AI allows banks to personalise and reduce friction throughout the customer journey. Personalisation and increased efficiency are achievable through automation with intelligent technologies, freeing up more time for personal contact. AI’s ability to quickly and accurately mine data and uncover hidden insights helps customise advice based on the client’s situation. Before AI, manually assessing the context of a client’s request was time-consuming. AI can process a much larger scope in less time and present its findings to advisors, who can use these insights in personal conversations. Smooth Customer Onboarding in the Banking Sector Personalisation enhances the customer journey, but a smooth process is equally important. Intelligent Process Automation can eliminate many obstacles. For example, consider the digital onboarding process for a financial service provider. Jack wants a new TV with a consumer loan and monthly deposits. Before AI, Jack had to fill out several forms and endure a lengthy process, often losing interest. With AI, Jack’s Know Your Customer (KYC) data is securely captured from his ID using a mobile device through image recognition and sent to CRM, case management, or other software. Machine learning then labels and classifies this information to the right fields. AI creates the documents and forms prefilled with the extracted data. Jack only needs to verify the details and digitally sign the document. This process, requiring minimal human intervention, is handled within minutes, allowing Jack to leave the store with his new TV the same day. Processing Incoming Emails with AI AI also streamlines the processing of incoming mail. Intelligent technologies efficiently extract, process, and organise all incoming information, whether paper, digital, structured, or unstructured. This is especially beneficial for handling support requests. For instance, Jack, who bought a new TV, accidentally needs to make a payment and receive a default notice. Jack transfers the payment and replies to the general address with the proof of payment attached. Thanks to AI, the bank’s mailroom efficiently handles this. Natural language processing, OCR, and machine learning quickly extract, process, and organise the information from Jack’s email. Thorough automation updates his dossier with the correct information and routes it to the right person. The payment is confirmed promptly, easing Jack’s worries. Sometimes, the payment confirmation can be automated without human intervention, removing the default warning from Jack’s file. What Are Banks Waiting For? A smooth, enjoyable customer experience will vastly improve client acquisition and retention. Automation can also save the banking industry up to €300 billion. So why is the banking world not implementing it en masse? Gartner research suggests it’s because enterprise planners are often unfamiliar with AI’s capabilities or whether it’s compliant with privacy regulations. These doubts make it difficult to decide how and where to start, but this is where Docbyte can help. AI is a journey fraught with economic, social, and political challenges. Deloitte’s research suggests making this journey a collaborative one to overcome the challenges posed by AI. This approach resonates with others too, such as Chris Skinner, author of ‘Digital Human’, who advocates for open banking where FinTech and traditional banks cooperate. Need a partner on your road to a better banking experience? We’ll gladly put our expertise in artificial intelligence at your disposal. Don’t hesitate to contact us, and we’ll discuss your plans over coffee.
The Digital Customer Onboarding Process
In digital transformations, the digital customer onboarding process is gaining significant attention, especially in industries like banking and insurance, where traditional paperwork still lingers. While e-commerce has streamlined the online buying experience, many sectors need help to match this efficiency. The urgency is magnified as today’s consumers, particularly the tech-savvy Millennial segment, quickly switch loyalties. They demand a seamless, quick onboarding experience similar to their retail interactions. Unfortunately, slow, paper-based onboarding processes persist in various organizations, leading to resource-intensive operations, low customer approval, and substantial dropout rates. To address this challenge, organisations must undergo a crucial transformation towards agile and automated customer/vendor interactions. The digital onboarding solution becomes pivotal, and key elements include efficient capture, identification, extraction, integration, verification, document generation, digital signature, process and archive, and authentication. While off-the-shelf and custom-made solutions exist, the true advantage lies in the holistic integration of these steps, ensuring a user-friendly front end and a fluid and automated back end. Understanding the Digital Customer Onboarding Process The digital customer onboarding process is how businesses validate new customer information, authenticate new customers, and integrate them into their systems. As all businesses should comply with regulatory concepts, this onboarding process is the same for banking, telecom, governmental sectors, or any other type of business or organisation. It involves collecting customer information such as name, address, and identification details, accepting any terms and conditions, and verifying financial information in the case of KYC. One potential benefit of the digital onboarding process is its convenience. Customers can easily submit information anywhere, anytime, using their mobile devices or computers. This creates a more seamless, hassle-free experience for the customer, allowing businesses to establish and maintain compliance with various regulations, such as Know Your Customer (KYC) and Anti-Money Laundering (AML). The Role of Digital Signature in the Customer Onboarding Process A digital signature is essential to the onboarding process, enabling users to sign legally binding documents electronically. Electronic signatures offer several advantages over traditional paper-based signatures, including improved document tracking and faster processing times. Moreover, e-signatures can reduce errors, mitigate fraud, and enable businesses to meet regulatory requirements if they are stored with a supplier who offers qualified electronic archiving. User Onboarding Authentication Authentication is the process of verifying a user’s identity. Online businesses typically use various identity verification techniques to authenticate new users, including passwords, two-factor authentication, biometrics, and others. User onboarding authentication is vital because it helps protect businesses from identity theft, fraud, and other fraudulent activity. Onboarding Process Flow Chart Here, we outline a comprehensive nine-step approach for a successful digital onboarding process, catering to both visible customer-facing aspects and equally crucial backend operations. These steps encompass; 1. Capture Definition: The initial step involves the acquisition of diverse documents, such as identification cards, utility bills, or other relevant forms, through various channels. Process Overview: The capture process utilizes advanced scanning technologies to ensure the digitization of physical and digital documents, laying the groundwork for subsequent stages. 2. Identification Definition: Once documents are captured, the identification step employs Optical Character Recognition (OCR) and intelligent algorithms to recognise and categorise the relevant information within each document. Process Overview: This stage involves extracting key data points like names, addresses, and identification numbers, forming the basis for the subsequent verification process. 3. Extraction Definition: Building on the identified data, the extraction step involves isolating and extracting specific information required for the onboarding process. Process Overview: Specialized algorithms analyse the document content, extracting relevant details such as addresses, phone numbers, financial information, or any other pertinent data crucial for customer identification. 4. Integration Definition: Integration entails incorporating the extracted data seamlessly into existing systems, ensuring a unified and coherent repository of customer information. Process Overview: The integration process connects the onboarding system with internal databases, Customer Relationship Management (CRM) systems, or other relevant platforms, fostering data consistency and accessibility. 5. Verification Definition: Verification is a critical step to validate the accuracy and authenticity of the extracted information, ensuring it aligns with predefined criteria and compliance standards. Process Overview: Robust verification processes are facilitated by automated checks, cross-referencing against external databases, and adherence to Know Your Customer (KYC) guidelines. 6. Document Generation Definition: After successful verification, the document generation step involves creating necessary agreements, contracts, or any essential paperwork required for the customer onboarding process. Process Overview: Automated tools generate customised documents based on verified customer information, streamlining the paperwork necessary to formalise the onboarding process. 7. Digital Signature Definition: In the digital signature step, the onboarding documents are presented for electronic signatures, allowing customers to securely endorse and authenticate their information. Process Overview: Leveraging advanced cryptographic techniques, digital signatures ensure the integrity and authenticity of the signed documents, eliminating the need for physical signatures. 8. Process & Archive Definition: This step involves orchestrating the onboarding process, guiding the flow of information through predefined workflows, and archiving the finalised documents for future reference. Process Overview: Automated workflows manage the sequential progression of onboarding tasks, ensuring a systematic and auditable process. The archival process securely stores all relevant documents for compliance and record-keeping purposes. 9. Authentication Definition: The final step focuses on authenticating the newly onboarded customer, granting access to relevant services, and ensuring a secure and seamless transition into the established customer ecosystem. Process Overview: Multi-factor authentication methods, such as biometrics or secure access codes, enhance the security of customer access and safeguard sensitive information throughout their journey with the organisation. Tips for Enhancing the Digital Customer Onboarding Experience An effective digital onboarding process has several key characteristics: simplicity, customer-centricity, security, and speed. To enhance your digital onboarding process, consider integrating automated workflows, ensuring seamless document approval processes, and reducing the number of manual touchpoints. Additionally, businesses should ensure that they collect only the necessary data from the customer and provide clear guidance throughout the onboarding process. By embracing this holistic approach, organisations can enhance the customer experience, achieve higher
Why RegTech is the Key to Seamless Digital Onboarding
In 2020, “The Banking Scene’s” first conference was held by Docbyte‘s CEO Frederik Rosseel. This conference gave the idea of a Digital Onboarding solution. This solution did not include any compliance or regulation but rather supported the idea of digitalization and innovation by shaping the customer’s experience. Digital onboarding refers to the digitalized feature of mobile banking; the better the UX (User Experience) design, the better the service. Frederik Rosseel undertook the path to expand the horizons of digital onboarding at the Banking Scene’s conference in 2020. This conference may have started as a presentation focusing on digitalization and mobile experience while neglecting the compliance and regulatory nuances. Still, it evolved the digital landscape with terms like “Regtech,” “KYC,” and “AML” taking the spotlight. This blog highlights the critical role of “RegTech,” or we may call it “Regulatory Technology,” in shaping the ecosystem digitalization perspective of organizations. With the continuous growth of RegTech, a seamless and compliant customer experience is guaranteed. What is RegTech (Regulatory Technology)? Regulatory Technology is an innovative concept in the financial and regulatory sector. It includes using modern technologies and solutions to optimize and streamline compliance operations, particularly those dealing with regulated industries like banking and finance. These regtech solutions ensure relevant organizations can apply regulatory requirements efficiently while enhancing user experience. Regtech KYC is an essential element of this innovative approach. KYC, or Know Your Customer, underlines the verification process organizations use to verify the identity and legitimacy of an individual. This process has been further automized with minimum human labor requirement only with the help of regtech solutions. The evolution of this smart solution has set trends in an ever-changing landscape for digital onboarding. It began with the idea of digitalization and merged the concept of compliance and regulation with user experience to focus on excellent customer service. The Evolution of Regtech Digital onboarding put forth a brilliant idea of improving user experience a few years ago. It’s important to note that compliance and regulations were not the primary focus at that point. The main idea was to digitalize the banking experience; however, the information was gathered from trusted sources. If we look into this concept today, regtech compliance has become a major trend. It integrates terminologies like KYC and AML to broaden its aspects and merge the application of regulatory compliance. If we fast forward to today, this idea has evolved from mere user experience to an indispensable tool that ensures compliance and regulation in different sectors. Let’s talk about another rising yet crucial aspect of regtech solutions: legal archiving and document verification. These technologies deal with storing and retrieving important documents while ensuring their integrity, originality, and authenticity. The archiving requirements are now more crucial than ever, and regtech has addressed this concern by providing effective and secure solutions. So, if you plan to streamline and improve your regulatory compliance processes while prioritising customer satisfaction, Regtech Solutions is the right answer for you. The Regtech Scene AI is transforming RegTech, making it more powerful and efficient. Thanks to recent advances, digital onboarding has matured into a comprehensive and seamless process trusted by regulators. New RegTech providers are entering the market, offering a broader range of solutions beyond UX as it shifts from a primarily UX-focused market. Digital onboarding is no longer just a marketing and sales tool; it is now essential for compliance. The shift to “end-to-end onboarding trusted by a supervisor” demands a superior and fully compliant approach to customer onboarding. The evolution of digital onboarding provides peace of mind to both the Sales Department and Compliance teams, ensuring that customers are properly identified and validated in accordance with the products they seek. Regtech Initiating Open Banking Open Banking has ushered in a new era for digital onboarding. Open Banking is more than just a buzzword; it’s a paradigm shift that will fundamentally change how we think about banking and digital onboarding. Regulations like PSD2 and the emergence of Open Banking are forcing traditional banks to rethink their business models. Banks are no longer limited to their own sales channels. Banking-as-a-service is gaining prominence in digital onboarding, freeing banks from their proprietary sales channels. Banking-as-a-service (BaaS) allows banks to partner with third-party providers to offer banking products and services. User experience and customer onboarding are essential in the new era of embedded banking. Embedded banking requires a fundamental rethink of the customer journey, with a focus on improving user experience and ensuring regulatory compliance throughout onboarding. How Regtech Stores KYC documents The era of regulatory technology has introduced transformative functionality related to the storage and management of KYC documents. Regtech KYC is an essential component that proves useful in financial and compliance-focused sectors to validate the identity of individuals. This focuses on fulfilling the regulatory requirements. This digitized transformation has automated and optimized the systems that ensure regulations are followed while improving overall customer experience. Let’s break into the process and see how it works: Streamlining Processes: By streamlining KYC processes, an organization can accurately ensure their customers’ identities. This is done by automating the identity verification procedure using different data sources that provide the information. Document Verification: With the revolutionized automated solution, regtech confirms the authenticity of crucial documents with the accuracy of recorded information. Secure Storage: Let’s admit we require secure document storage for all verified KYC documents, and this has just been made easy. This storage keeps documents stored safely and ensures their authenticity is maintained. For this purpose, it uses data encryption and secure databases. Retrieval and Accessibility: Stored documents can be accessed whenever needed. This frequent accessibility is essential for regulatory audits and customer service. Effective retrieval and accessibility is a hallmark of a productive regtech solution. Compliance Assurance: Compliance is another aspect that cannot be neglected. By automizing the processes and ensuring the accuracy and security of documents, organizations are guaranteed to meet and fulfil the regulatory requirements. What are the Archive Requirements for financial documents? With proper management and archiving of financial documents, regulatory
Getting customers on board with AI
You’ve pulled out all the stops to convince a potential client of the quality of your services and products. There’s just one more hurdle he or she needs to take: the onboarding process. An essential step, yet this is where banks and insurance companies notice a lot of customer dropouts. Why? Customers get frustrated by communicational hiccups or the time-consuming steps they need to take. Standard automation can solve a number of grievances. However, the biggest frustration – having to reenter information again and again – can only be alleviated by using artificial intelligence (AI). Why your automation should be intelligent: Automation isn’t something new. We’ve already been letting the computer handle numerous tasks through rule-based programming, such as creating the necessary folders when a customer entry is created. However, onboarding is a complex process with many steps and different types of files and data. Long story short, we’re at the limits of automation by programming manually. Intelligent Process Automation, AI, and machine learning (ML) can realize the humanly impossible. With the right technology, you can replace the process of manually signing and posting documents with a simple selfie and face recognition. Less manual (re)entry of information: During an onboarding process a customer needs to share quite a bit of information. Documents need to be uploaded, forms need to be filled in and signatures need to be added. AI and ML can speed this up significantly by reducing the amount of information you need to enter and process manually. Above all, they solve one of the biggest frustrations of your potential customer during such processes: having to reenter data they’ve just put in in a previous step. Data extraction from any file: The first step in making onboarding an intelligently automated process is making sure customers don’t have to enter information manually. For instance, when they upload a document, Natural Language Processing – where ML algorithms learn to understand human language – can help the computer interpret what is written and extract data such as the name, date of birth, sex, occupation and more. When you add Optical Character Recognition – where AI can recognize letters on an image – your intelligent process can even get this information from a picture of an ID. So, there’s no need for your clients to type out all this data in a form. Automated form filling in real time: Having understood and extracted the right information from documents, artificial intelligence then routes all this information to – preferably – your CRM or case management system and stores it directly in the necessary fields. This means that the information is available straight away. If the customer advances to the next step, artificial intelligence can fill in part or even the entire form based on the data it extracted before. Consequently, this solves one of the biggest frustrations in the onboarding process for your customers and significantly speeds up everything. Moreover, at no point in these first steps is there a need for human intervention. This frees up a lot of time for your employees too. They’ll be able to move from repetitive administrative tasks to focusing on helping clients with advice. The result is a compelling job and better customer service. AI throughout the process: It’s not just in these first few steps of an onboarding process where machine learning and artificial intelligence can make a meaningful contribution. Through IPA, the next steps can become more efficient than ever before. For example, not only can forms be filled in automatically, but documents such as invoices, contracts, and more can also be automatically generated by AI. Furthermore, machine learning can help safeguard your organization and your customers against fraud, as face recognition provides secure identity checks. With AI, endless possibilities lie ahead. At Docbyte, we are using digital onboarding software to provide our customers and their clients with a seamless and quick experience. Be sure to check it out and see how we cut the number of customer dropouts in half through Intelligent Process Automation in our solution.
Nine steps to successful Digital Customer Onboarding [Whitepaper]
A positive digital customer onboarding experience confirms to your customers that they made the right decision when choosing to work with your company. The two main reasons why customers leave are: they don’t understand your product, or they don’t get any value from it. Key Steps in Finance and Insurance Customer Onboarding In customer onboarding for Finance and Insurance, we generally see the following steps: Customer Identification Document and Data Collection Customer Vetting and Fraud detection Document Generation Document Signing Document Archiving These are not all the elements that are involved and processes can vary from very simple to very complex, but we see 9 recurring building blocks that allow you to implement any possible customer onboarding process. Interested in digital customer onboarding? The fight for a new customer has never been more difficult or costly. Research reveals a global increase in overall customer willingness to change banks or insurance companies. This is particularly true for the Millennial segment, who have only known the digital world. They understand how easy it is to switch loyalties and don’t see any reason they should treat your institution differently than another service provider. The competition for new customers is fierce. That customer wants, in analogy to his retail experience, to be up and running in a matter of minutes. As soon as he is confronted, even online, with tedious interfaces, exhaustive question lists, time-consuming authentication processes, and yes, the request to finally meet a representative in person to literally fill in the paperwork before his account is active, it shouldn’t come as a surprise that he is quicker out than in. Result? A potential customer is lost! So, if all this is known then why are there still so many organizations that rely on the classical methods of customer onboarding? Read on in the whitepaper below to discover the 9 steps of a successful Digital Customer Onboarding process: