Using an application form to obtain client details is still the most common form of onboarding. This is how it was done for the past few decades and we will still need to submit these for a little longer, but change is already in the air. And the reasons why are obvious.
Firstly, this approach requires a potential client to go to a certain office or branch in order to request an application form. He/she needs to take the time to fill in all the details and again wait to submit the form. Usually there is somebody who can assist the client if necessary.
A lengthy process now begins that is shared between several different departments. The details are captured, verified, supporting documents obtained, the form filed, the client informed of the outcome and eventually the process is complete. The relationship with the client is now established.
Often there are unforeseen complications, such as an incomplete or misplaced application form, errors made by the client or the capturer, missing supporting documents and more time is needed to get the required information. Then we need to ensure that the client understands the legal terms and that we comply with industry regulations.
If all goes well, the entire onboarding process using a written application form shouldn’t take more than a day or two, which the client anticipated from the start. If something is incorrect the client has to be contacted in order to update the information, which may involve more paper work and an already unhappy customer.
But imagine his/her delight if it would only take five minutes. Done and dusted in five minutes. That would be incredible! Our clients would be raving fans before we even sell anything.
Taking all of this into consideration, it is no wonder that client onboarding is viewed as a routine process and not as a gigantic opportunity to build relationships. But what keeps us stapled to the application form approach?
First and foremost the absence of a flexible or scalable IT system to onboard clients has been a main barrier. Without a suitable IT system, there is simply no onboarding flow. Many financial institutions have multiple systems and need to find ways to ensure proper interactions between them. And that is no easy task. While onboarding clients with emails and faxes is completely acceptable, any automation in this process would enable faster onboarding, verified data and happier clients.