Inefficient Onboarding Costs Business and Commericial Banks $3.3 Trllion In Lost Revenue
New research conducted by Fenergo reveals that slow and manual onboarding processes cost the commercial and business banking market $3.3 Trillion in the past year. The lost revenue was due to clients abandoning their applications during the onboarding process.
The research also reports that onboarding times have risen by an average of three weeks in the last 12 months. Other findings include:
– 18% of banks still rely on manual processes for KYC – including telephone, email, letter or in-person meetings
– 14% say that 20 or more people are involved in the onboarding process for just one complex client
– 15% say that they had to get in touch ten or more times for data or documents to onboard new clients
– 92% of CEOs agree that they need to transform radically to compete with digital-first new banks. This will be particularly important as they compete in a constantly shifting regulatory landscape.
Fenergo sought the viewpoints of more than 500 senior decision makers at commercial and business banks across EMEA, North America and APAC from August-September 2019.
"With more and more digital-first challenger banks entering the business banking market, customers now have the ability to sign up to a new bank within minutes. Business and commercial customers are naturally going to gravitate to banks that provide the same low-touch experience as the consumer digital services they are familiar with, said James Follette, Global Head of Commercial, Business and Retail Banking, at Fenergo."Whilst banks such as Revolut and Simple have the benefit of being digital-first, it's not too late for more traditional commercial and business banks to bring their processes up to date and adequately compete. If they don't make these changes, money and customer losses will be such that they're unlikely to survive a downturn."
Fenergo provides commercial and business banks with Client Lifecycle Management (CLM) solutions, which deliver increased efficiencies and faster onboarding times.