Effective onboarding for corporate customers: a short guide
26 May, 2020
Digital processes allow banks to quickly address customer needs and save costs when onboarding corporate customers
It’s not just private customers who want a fast and easy onboarding process – corporate customers do too. While many banks and new competitors have optimised their onboarding processes for private customers in recent years, corporate customers are often still faced with protracted and expensive procedures. Digital onboarding offers the opportunity to accelerate customer acquisition in corporate banking, save costs and increase customer satisfaction among their business clients.
To do this, it is necessary to fundamentally reorient the corporate customer strategy – by closely aligning it with changing customer needs in the digital age. In the current challenging environment of continuing low interest rates, growing competitive pressure and – in the wake of the coronavirus pandemic – an economic slowdown, digital onboarding can position itself as a competitive advantage. PwC can support financial service providers to successfully position themselves in the corporate business domain over the long term.
Meeting regulatory requirements and improving data quality
Corporate customers in the banking business need a legally compliant, fast and fully digital onboarding process. At the same time, both traditional financial service providers and young challenger banks are facing enormous challenges in their quest for innovative solutions:
- Increased regulatory requirements due to the increasing amount of information required (anti-money laundering (AML)/know your customer (KYC)) and growing complexity of checks to be carried out.
- Unstructured datasets from various sources lead to data being insufficient in both quality and quantity, and make process automation more difficult.
- Low levels of process automation require repeated exchanges with customers to gather information. This can lead to bottlenecks in capacity.
To meet the high standards of corporate customers and to master the challenges of the demanding market environment in corporate banking, banks and financial service providers should waste no time in leveraging the full optimisation potential that can be gained by digitalising the onboarding process.
The five most important steps in corporate customer onboarding
The first task is to identify all relevant process steps. This should be carried out at the very beginning of a holistic realignment and digitalisation process for corporate customer onboarding. In the subsequent phases, the digitalisation potential of each element can be determined and the necessary steps can be taken.
Innovations offer considerable savings potential
Innovative solutions and digital processes give financial service providers the opportunity to save time and money across all relevant process steps.
Workflow tool optimisation
Successfully integrating intelligent workflow tools that guide and structure the entire onboarding process can cut total costs by 8 percent and the duration of the process by 16 percent.
Purchasing external data
Strategic cooperation with a data supplier for the procurement of structured company data (e.g. company data, representation rights or shareholder structure) can reduce costs by 9 percent and the duration of the process by 45 percent.
Name list screening
Searches for adverse media yield high false positive rates, which can be greatly reduced by automating the process with intelligent technologies. This can cut costs by around 11 percent and the duration of the process by 14percent.
Combination of various individual measures
Combining the optimisation measures can reduce a bank’s total onboarding expenses by up to 65 percent.
Outsourcing KYC processes
Specialised service providers can conduct the entire KYC process digitally, with full legal compliance. The bank issuing the request then provides the KYC-compliant customer data record. This results in considerable savings potential – up to 84 percent in some cases.
Focus on new customer needs
Analysing critical use cases in the short term, defining new processes, and developing and implementing solutions will help banks to improve their customer experience quickly and to realise savings potential.
In the long term, financial service providers should also check whether their corporate customer strategy satisfies the evolving customer demand for quick and simple onboarding.
"Digitalising onboarding processes for corporate customers offers enormous savings potential for banks."
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