‘Trusted’ Data Sets Take Fraud Out of Online Onboarding Processes

When it comes to a user-friendly experience, online onboarding processes play a key role.

Not only in keeping things flowing smoothly but also by providing peace of mind by addressing customers’ increased fraud and risk concerns.

For organizations, meeting that expectation begins with the onboarding or enrollment of potential customers, a process which, according to Gareth Walker, should be as easy as logging into your phone or your social media account.

But data shows that businesses are still lagging and are losing potential customers who no longer want to spend an excessive amount of time filling lengthy forms to complete an application process, said Walker, who is the global head of client and digital onboarding at Refinitiv (an LSEG business), a U.K.-based business and financial markets data and infrastructure provider.

In fact, he pointed to recent data showing that 68% of customers abandoned a financial services application in 2021, with millennials and Gen Z customers scoring even higher at above 70%.

Understanding those challenges is even more critical because 52% of customers say they’d be less likely to use a company service in the future if the onboarding process is perceived to be poor, he added.

All this data, he argued, goes a long way to show how much customer expectations have changed over time and how end user expectations are continuously leaning toward fast, easy-to-use and seamless digital experiences.

“What that means is firms buying [and coupling] trusted data sets from providers, working that into the background of the process,” which then translates into demanding less information from the end user which is still enough to be able to onboard and KYC that user and manage the fraud and compliance risks, he explained.

And considering that customer experience investments are estimated to make up about $300 billion of the $1.8 trillion spent globally on digital transformation efforts in 2022, Walker said progress is being made as more organizations see the key role digital onboarding plays in their overall growth.

“That [data] highlights just how immediate and substantial the issue around digital onboarding is and how seriously it’s being taken.”

Prioritizing End Customer User Experience

According to Walker, clients have traditionally leveraged Refinitiv’s in-house data and technology as part of their onboarding process to accurately identify and authenticate their customers in real time, as well as to mitigate identity payments and compliance risk throughout the customer life cycle.

Related: Refinitiv Debuts Digital Onboarding Tool

And building on that, the company recently launched a new global onboarding solution to help businesses address that urgent need for remote secure and friction-free remote onboarding processes.

That new tool, he explained, “takes that same market leading data, but packages it into a low no code, highly configurable, end-to-end onboard experience,” together with biometrics checks, social media intelligence, mobile and email verification, address and identity verification and sanction screening.

Per Walker, the solution also goes beyond accurate customer identification and authentication to prioritize the user experience of their customer’s customer. “This is what makes the product so appealing, both from an end customer experience perspective and also from an anti-fraud and risk management perspective,” he said.

And with application fraud being both widespread and wide-ranging since the onset of the pandemic — it impacted 1 in 6 U.S. consumers in 2021, per Walker — having strong onboarding processes is a luxury firms can no longer afford.

In fact, he noted that attacks not only impacted traditional financial products such as checking accounts and credit cards, but also buy now, pay later (BNPL) schemes, utility accounts, health insurance and federal benefits — representing a $24 billion loss in identity fraud attacks in 2021, while instances of reporting consumer fraud grew 29% between 2019 and 2021.

These numbers, Walker said, further underscore just how vulnerable the onboarding process is to identity theft due to the high level of friction contained in many of the onboarding journeys firms provide their clients.

This puts the onus on organizations to make sure that they’re addressing that dual concern to avoid driving good customers away with the bad ones.

“[On one hand] there’s a landscape in which fraud is rampant and the numbers are rising, but also a world where expectations are changing such that an overbearing onboarding experience is going to push good customers [away] and with it good revenue away from your organization,” he said.