The banking system is vital to any economy, especially in developing countries like India. And one major hurdle in making the banking system more compatible is to improve the instant account opening process online. It can make the process easier for customers who want to open an account from the comfort of their homes.
This article will look at the specific barriers to improving the digital account opening process and explain why improving it is vital to consumers and how improved procedures could help both the bank and the end users.
Challenges in Digital Account Opening
Financial institutions have generally struggled to simplify the account opening process over the years while ensuring the necessary checks and balances are in place.
The question remains whether digitising the process would remove the checks and balances or add new ones.
For example, fraudsters may abuse the process by submitting false information, leading to genuine customers being defrauded and harassed and banks losing money.
How to Improve the Digital Account Opening Process
There are some steps banks can take to improve the overall digital account opening experience and prevent fraud from happening during the process at the same time.
Banks can use identity verification methods, such as government-issued ID cards, mobile phone authentication, and other proof of address documents, to confirm the customer’s identity.
Making Use of the App
One option would be to allow customers to download an app on their smartphones, where they can fill out the required information digitally. This eliminates the need to enter information manually and makes the process faster and more efficient.
KYC in Branch
Another way to improve the digital account opening process would be to complete the final KYC process in the branch.
This includes setting up a web application or online form, allowing customers to submit their information on a secure website, and letting them come to the branch physically with all the necessary documents to verify their identity to get them instant access to their basic savings bank deposit account.
Banks can protect themselves against phishing scams by using various anti-phishing measures. They can also implement multi-factor authentication, which requires a password and a second factor, like Aadhaar card biometrics, to unlock accounts.
Overall, banks should do their best to ensure they are always protected against potential threats.
Why Improving the Digital Account Opening Process Is Important
There are several reasons why improving the digital account opening process matters for both, banks and their customers.
· It helps the bank retain its customers because they can access a seamless experience whenever they want to open an account.
· It allows customers quick access to their funds, which means they won’t face unnecessary delays that might hinder them from accomplishing their goals.
· It enables people to save money by avoiding having to physically go to the bank in person to submit applications and pay bills. Finally, it gives consumers greater flexibility and control over their finances. Because they can manage their accounts anywhere and anytime they wish.
Benefits of Online Account Opening
Offering customers the opportunity to open an account online in the comfort of their homes reduces the need for the customer to make appointments at the bank branch. Which means they can spend more time doing something else.
· By allowing customers to open a basic savings bank deposit account on demand. The bank could increase the number of customers it serves per day. Also, reducing the workload for employees saves the bank money on salaries and benefits.
· Banks can save lots of time and resources by digitising the process and allowing instant account opening. Employing cutting-edge software solutions, they can ensure that all the data they collect during the account opening process is 100% accurate.
· There is also the chance for the bank to generate additional revenue by selling its data to third-party companies. For example, if a customer wants to purchase insurance. The bank could share the customer’s personal information with the insurer and earn a commission every time a policy is sold.
Ultimately, the future of the banking industry looks bright. Thanks to digitisation, many banks have already embraced new technologies and innovated to improve the customer experience.
However, a few obstacles still need to be overcome before we see a complete transformation which will benefit the consumer.