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Monthly Archives: November 2011

Customer Onboarding: Two Critical Questions

When someone walks into the branch of a financial institution to open an account, the branch personnel need to answer two questions. First, is this person who they say they are? Second, do we want to do business with them?

After a cursory examination of the person’s driver license and a few background questions, most branches consider the first question settled. They focus most of their attention on the second question. For example, they’ll use a risk-analysis service like TeleCheck to determine if the applicant has a history of writing bad checks. They’ll often perform other queries, as well.

If the check analysis and other analyses don’t raise any red flags, the branch staff will typically open an account for the applicant.

Do you see the danger here?

All the data analysis performed to answer the second question is predicated on a correct answer to the first question. Figuring out if Jane Smith at 123 Meadow Street has ever bounced a check is relevant only if the person standing in front of you really is Jane Smith. If it’s really Mary Jones posing as Jane Smith, all your analysis about Jane Smith is only leading you astray. In fact, Mary Jones may have chosen to impersonate Jane Smith precisely because she knows Jane Smith has a high income and a good credit history.

Back-office exception handling is not a substitute for determining immediately whether or not customers are who they say they are. Discovering two days after an account has been opened that the woman claiming to be Jane Smith was really somebody else is practical knowledge gained impractically late—by then, the institution has invested its time and money in onboarding a customer who’s going to turn out to be trouble.

To defeat fraud, financial institutions need identity verification that takes place in real time. Branch personnel need to be able to determine instantly whether an applicant is who they say they are. Only real-time identity verification can ensure that other risk-analysis services—such as querying a person’s check-writing history—provide genuinely useful knowledge, instead of simply furthering a fraudster’s deception.

To learn more about Accelerated Insight, our real-time identity verification service for financial institutions, please contact us.

CRM and Customer Onboarding

Customer Relationship Management (CRM) records are obviously essential for any Financial Institution. CRM records are required for Know Your Customer (KYC) mandates, effective outbound sales and marketing initiatives, and daily business operations.

You rely on your CRM records. But how are you entering these records in your CRM system?

It turns out that CRM data entry can have a significant influence on the lifetime sales you make to your customers.

Positive First Impressions Boost Sales

Most sales to DDA customers take place in the first few months of an account being opened, according to BAI. Sixty percent of sales will take place in the first month; 75% take place in the first three months.

Your initial meeting with a customer is critical. The customer is clearly prepared to buy something from you. It’s a great opportunity for needs-based selling, and for establishing trust. Not surprisingly, studies show that trust turns out to influence how much customers will buy in the future.

In the course of your initial meeting with a customer, then, you and your institution should achieve these four goals:

  • Verify the identity of the new customer to avoid fraud
  • Collect the customer’s personal information for CRM data entry and later sales and marketing fulfillment (e.g., mailing a debit card and a PIN).
  • Perform needs-based selling
  • Build trust with the customer, forging a relationship that will encourage future business.

The first two goals include data collection; in fact, they both use the same data—the customer’s name, address, and Social Security Number. The second two goals involve face-to-face time with the customer. These goals are best achieved when the branch staff are looking at customers and conversing with them, rather than pecking at a keyboard and filling out labyrinthine forms.

Optimizing Branch Operations Involving CRM

The trick to pulling this all off? Achieve goals 1 and 2 quickly and efficiently so that identity verification and data entry do not interfere with goals 3 and 4.

Here’s where CRM data entry becomes important. The process can go wrong so easily. For example:

CRM data entry the wrong way:

  • Branch office staff exasperate the customer by asking for the same information over and over.
  • Branch office staff bog down the sales process with lengthy questionnaires and slow typing.
  • Branch office staff make typing mistakes that generate exceptions and that undermine future fulfillment efforts (a man named Pat gets a promotional letter addressed “Dear Pam”)

CRM data entry the right way:

  • Sales staff do no typing at all or only minimal typing, because data comes from magstripe readers and other data sources.
  • Sales staff never repeat questions, and all questions are brief and to the point.
  • Error-free data improves customer satisfaction and increases the return on future sales and marketing efforts.

A Real-life Example of CRM Frustrations

Here’s an example of how CRM data entry can frustrate bankers.

I recently spoke to bankers at an institution that’s been using an identity verification service that is not integrated with their CRM system. Because the two systems are not integrated, the customer onboarding process required sales staff to key in a DDA applicant’s personal information twice—first into the identity-verification service and then again into their Customer Relationship Management (CRM) system. Of course, all that typing interrupts the selling process. It also introduces lots of opportunity for keyboard errors. The bankers are frustrated. Lack of CRM integration is making customer onboarding more time-consuming and complex that it needs to be. No one is winning in this scenario.

This bank is now searching for an identity verification service that is faster and more accurate and that can be easily integrated with their CRM system. The bank hopes to enter CRM data once and take care of identity verification and CRM input in a single operation.

Accelerated Insight:  Identity Verification that Integrates with CRM

In contrast to the disjoint systems being used at the bank I just described, Accelerated Insight not only verifies identities in real time, it also integrates with CRM and other branch systems, eliminating redundancies and reducing errors. Accelerated Insight accepts data from mag-stripe readers, so branch personnel may not have to do any typing at all to enter a customer’s identity information. Simply swipe a driver license—even a driver license with an old address—through a reader, and Accelerated Insight instantly returns the person’s name, current address, date of birth and Social Security Number, along with a risk and confidence score.

If your institution has been relying on disjointed CRM and identity verification services, and you would like to get a free trial of Accelerated Insight, please contact us.

2011 BAI Retail Delivery Conference

Demoing Real-time Identity Verification at BAI Retail Delivery 2011

In October, we attended the BAI Retail Delivery Conference in Chicago. We thought the conference sessions were very educational, including many presentations by industry practitioners with great data and insights. In future blog posts, we’ll be writing about some of the big ideas discussed at the conference—ideas such as applying new technology to streamline customer onboarding and developing strategies to increase the profitability of DDA accounts.

On the exhibit floor, we had the chance to demonstrate Accelerated Insight, our real-time identity verification solution. It was enjoyable to see “the light bulb turn on” with so many people once they saw how easily they could eliminate keystrokes, reduce exception handling, prevent fraud, and create more time for their front line employees to sell additional products to new customers.