Alkami Technology Plano Texas

7 Keys to Simplifying the Digital Account Opening and Loan Origination Process

When it comes to converting more users in the digital account opening (DAO) and loan origination process, speed and simplicity are the keys for financial institutions (FIs) to dramatically cut cart abandonment rates and better compete with the rising number of online banking competitors. Har Rai Khalsa, VP, General Manager of Digital Account Opening & Loan Origination at Alkami, laid out the following steps for a successful, digital onboarding experience during The Financial Brand’s webinar hosted by Jim Marous.

1. Leverage the same information to feed both the DAO and loan origination processes.

In one motion, capture consumers and businesses information, and only then request any additional fields required for the type of financial product they are applying for – loan or credit card.

2. Stop playing 20 Questions.

When Khalsa and his team reimagined DAO and loan origination for Alkami Ignite, they eliminated cumbersome requirements such as driver’s license scan—which had been triggering high online user dropoff—and only asked additional eligibility questions if applicants entered an address outside of the FI’s geographic-servicing area. Such changes have helped Alkami clients cut their cart abandonment rate to about 30%, half of what they’d been seeing with more complex, legacy processes.

3. Move pro forma aspects into the fine print.

The best example of this is in the credit union space, where many uninitiated applicants are perplexed by the process of creating membership share accounts. They think, why does the credit union require that when I’m just here to open a checking account or credit card? Credit unions leveraging Alkami Ignite can move the membership share language into the terms and conditions to avoid confusion and keep applicants from feeling they are somehow being upsold.

4. Emulate Apple Pay.

Look at how frictionless the top fintech players have made the account origination process and how they integrate offerings to get account holders up and running in minutes, guiding them through the application flow with ease. There’s an especially big opportunity for FIs by empowering users to have their debit or credit cards immediately push provisioned into a digital wallet upon underwriters’ approval. 

“The fact that a credit card could be used as a competitive product to buy now, pay later options or loan applications is a really exciting theme,” Khalsa says. “If you can originate it, approve it, and then push it into a digital wallet where consumers can actually transact with that card at the point of sale, you’ve now created a product that sets up both your debit cards and your credit cards to compete with buy now, pay later.”

5. Align the online and in-branch application processes.

Alkami Ignite has designed the in-branch experience to mirror the online experience so that bankers and member service representatives enjoy the same top-notch experience when opening new accounts that self-serve online consumers and businesses encounter. Capturing the same streamlined data via both in-person and online channels also helps reduce potential gaps in account information – creating a single source of truth.

Before the processes were aligned, “If you added a custom field to your online channel, you had to remember to add it to the in-branch channel or else all your in-branch applications had less data than online,” Khalsa notes. “We’ve mirrored the experiences both to make it more enjoyable for the humans—whether it’s those applying for an account or those working for the FI and opening accounts on behalf of the applicant—and to reduce repetitive work between online and in-branch systems.”

6. Be ready to take the handoff in-branch.

FIs can turn application dropoff into conversions if they are ready to assist skittish or technologically-challenged applicants who start the online process and then want to finish in-branch. Maybe the applicant doesn’t want to enter their Social Security number online, but they’ve already input their name, email, phone number and address. Inform that potential customer or member with words of encouragement, “you’re halfway through, and you’re welcome to come into the branch to finish.” If the process is fully integrated, the banker or member service representative can pull the application from the digital system and enter any missing information. Once they capture the funding information, they can give the applicant a signature pad to e-sign their documents and help them download the FI’s mobile app and seamlessly access their accounts in digital banking.

“It’s not enough for us just to take an application online,” Khalsa says. “That application needs to be ready in the branch if there’s any type of underwriting or processing that needs to take place.”

7. Tout the streamlined process in your marketing.

Marous describes working with a small credit union in California that put a huge effort into simplifying their deposit account opening and loan origination processes, but still saw openings lag. “I asked, ‘Have you promoted the fact you can do these things that fast?’” Marous recounts. “They said, ‘I guess we haven’t.’ Just because you build it doesn’t mean they’ll come. We sometimes have to blow our own horns when we solve these problems because our counterparts have not.”

For more insights into streamlining your FI’s account opening process and how Alkami Ignite can help, check out the full on-demand webinar, Simplifying Digital Account Opening and Loan Applications.

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