With the power of technology at our fingertips, people expect instant outcomes, from search engine results to their digital banking platform. For everyday financial products, like deposit accounts, consumers no longer want to come in-branch to complete their application. They want mobile-first capabilities and immediate access. That’s where digital account opening comes in.

While financial institutions may think of their competition as neighboring banks and credit unions, their biggest competitors are megabanks, neobanks and fintechs with innovative experiences. To stay relevant for customers and members, financial institutions need to deliver a seamless digital experience, starting with digital account opening.

Take it from Brett King, Chief Executive Officer and Founder, The Futurists Network. He stated in The 2024 Playbook: Budgeting & Strategies for Financial Institutions, “in markets where digital bank or fintech charters were readily available, we saw a rapid shift of market share to new operators. Two of the most frequent reasons given for shifting to a neobank were ease of account opening (Digital Account Opening) and superior user experience (UX) / customer experience (CX).” As consumers increasingly select neobanks, this market shift should encourage financial institutions to evaluate their digital experience for new account opening.

Win the user experience battle with digital account opening

Completing an application for a new deposit account should be as simple as a couple of steps. Applicants expect seamless experiences and are deterred by too many manual steps. Per The 2024 Playbook: Budgeting & Strategies for Financial Institutions, “to stay relevant to account holders, financial institutions need to make account opening quick and easy, within 5 minutes.”

Source: Research by ABBYY, reported by OneSpan in June 2023 

Consumers have turned to neobanks for the personalization they receive. By personalizing the digital banking experience, consumers feel a connection to their financial institution. As humans, it’s only natural that we want our individual needs addressed. Financial institutions need to fill this gap by personalizing the digital banking platform’s UX.

How can financial institutions achieve this? By making customers and members feel seen and understood. Alkami empowers financial institutions with digital account opening technology to start the relationship and cultivate it through digital banking. 

Exceed expectations during onboarding

For financial institutions who offer account origination, many users are still unable to complete their application without coming in-branch. Each step of the application that a user experiences friction increases the chances that they drop-off, potentially ending the relationship they would have had with your financial institution. 

As consumers prioritize the UX when selecting a financial institution, onboarding processes must adapt to exceed expectations. It is important to remember that UX is objective, not subjective. UX goes far beyond design preferences to address ease of use.

“A barrage of opportunities and challenges — the uncertain economy, increasing compliance and fraud issues, competition for deposits, the ever-shifting loyalties of younger account holders and more — are coalescing into the urgent need for financial institutions to provide heightened user experiences.” 

 – The 2024 Playbook: Budgeting & Strategies for Financial Institutions

The financial services industry is one of the most regulated industries in the world, and for good reason — consumers, businesses, and governments trust financial institutions to be dependable and put their funds to good use. Financial institutions face explicit regulations for verifying an applicant’s identity, identifying their intended use of funds, risk assessing the applicant, and many more back-office processes. Rather than burdening the applicant, financial institutions should leverage data to improve functionality and automate manual processes.

Use data to enhance user experience

In the digital era, there’s a tremendous amount of data available on customers or members, financial institutions just need the right tools to harness it. Consumers know their data is available and want their financial institution to use it to their advantage. Focused on simplicity, Alkami’s approach to digital account opening is highly dependent on the financial products added to the user’s shopping cart. By configuring onboarding workflows to the individual user, applicants complete minimal fields and submit their application in three minutes or less. 

To support users throughout the application, Alkami deploys a multi-layered approach to identity verification with integrations for Non-Documentary Customer Identification. Some financial institutions are hesitant to transform their Customer Identification Process (CIP) from Documentary to Non-Documentary. But financial institutions that make the switch can strengthen their internal operations while improving UX. Instead of requiring in-branch verification or document uploads, applicants can simply enter their address, phone number, date of birth, and social security number. 

Through Alkami’s extensive API network, financial institutions can streamline Know Your Customer (KYC) processes by validating the user’s information against third-party databases for instant identity verification. Additionally, Alkami leverages integrations for instant account verification, empowering users to seamlessly fund accounts. This integration automates financial institutions’ compliance efforts with Nacha’s account validation rule for enhanced fraud detection on ACH transfers. 

To ensure users receive real-time decisions on their application, Alkami deploys powerful integrations with debit and credit bureaus and identity verification providers for rules-based decisioning. Alkami alleviates back-office teams from manual processes with end-to-end dataflow to core processors for automated account creation and digital banking registration. Once approved, account holders can log into their digital banking platform to add their new debit card to their digital wallet of choice, Apple Pay or Google Pay.

With Alkami, an application that starts digital stays digital. No in-person visits are required unless the customer or member wants to visit the financial institution. By prioritizing UX, design, and ease of functionality, financial institutions can exceed user expectations, onboard, and nurture that new relationship for years to come.

Frequently asked questions

1. What specific security measures are in place to protect application data during the streamlined digital account opening process? 

Alkami prioritizes consumer data protection by implementing advanced security protocols, including encryption and multi-factor authentication, ensuring a safe and secure application experience without compromising speed. Additionally, our digital account opening solution leverages Non-Documentary Customer Identification methodology for frictionless, yet secure identity verification.

2. Can applicants expect any follow-up verification steps after completing the initial quick application, and if so, what do those entail? 

Post-application, applicants may receive additional communications from the financial institution which are automatically sent to the email associated with the application. This could involve confirming personal details or additional security checks to ensure the integrity and safety of user information and accounts.

3. How does Alkami’s digital account opening solution integrate with a financial institution’s existing digital banking platform? 

Our digital account opening solution is designed for seamless integration with Alkami’s digital banking platform. It uses adaptable APIs to ensure compatibility and enhance the existing digital infrastructure without requiring significant overhauls or adjustments.