Four Key Customer Journeys for Virtual Banks

Virtual Banking is here. The recent issue of new Virtual Banking licenses in Hong Kong and the upcoming licenses in Singapore have spurred the need for building new age banking systems that leverage the latest technology stack. This is a great opportunity for some of the existing banks to re-imagine and rebuild their banking architecture, while for new entrants it’s an opportunity to define and build a modern banking solution; efficient and future proof. As a matter of fact, the HKMA guidelines for Virtual Banks promote the use of new technology for providing a better customer experience.  Based on the demands of today’s consumers, especially millennials, this will require Virtual Banks to provide mobile, frictionless and secure services. In this post, I will share the basis of four key customer journeys for Virtual Banks and touch points where Customer Identity and Access Management will play a significant role.


Virtual Bank: Frictionless Onboarding

One of the key challenges that banks face today is onboarding new customers. In fact, as per some of the reports, the abandonment rate is 70-90% if one has to visit branch to complete the onboarding. The following example journey illustrates the steps required to easily and quickly on board Amy digitally with a self-service option to enroll for multi-factor authentication using her smart phone.

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Virtual Bank: e-Know Your Customer (eKYC) 

Once Amy is onboarded with a basic account and multi-factor authentication, one of the next steps for Virtual Banks is to perform the Know Your Customer (KYC) check. While this is a mandatory step before one can start transacting, sometimes it’s the most difficult one to accomplish. Why? Because it is replacing the physical check of end users, which was previously achieved by visiting the branch and sharing identity documents like passport, driver's license, employment letter and national identity cards. The good news is that this can be achieved with high level of confidence with technology advancement using Artificial Intelligence and Machine Learning from solutions provided by the likes of Daon, Jumio and Gemalto for eKYC. An example of the steps involved for an eKYC consumer journey is depicted below.

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Virtual Bank: Contextual Authentication & Authorization

Once Amy has signed up, been verified and completed her eKYC journey, she starts using the online and mobile banking facilities. Contextual Authentication and Authorization here helps in ensuring that while we are providing a frictionless experience to Amy for low risk transactions by only asking for username password-based authentication, if she wishes to conduct a high risk transaction i.e. adding a payee or transferring a large sum of money, her specific context is examined again and if deemed risky the Bank asks for a step up in authentication to reach a higher level of assurance before allowing the transaction. An example of the steps involved for this journey for Amy is illustrated below.

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Virtual Bank: Consent Management 

Personalization without breaching consumer privacy can be the key differentiator for the new Virtual Banks. This brings us to the next journey to consider for Amy, that of managing her consent. For example, Amy wants to apply for a new auto loan to buy her dream car. While she has been searching online on various websites and aggregators to compare rates, what if she can get a personalized offer from Cool Bank? Understanding what your customer wants and positioning relevant offers is the key here. An example of the steps involved for this journey for Amy is shown below.

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Customer adoption is one of the key variables every Virtual Bank is worried about. We believe that Customer Identity and Access Management will be the difference between adoption or lack of it, due to the significant touch points throughout the variety of journeys each customer makes in their everyday banking. Designing these journeys to avoid abandonment, increase satisfaction and drive deeper engagement, involves the kind of metrics and measures that Intelligent Authentication provides. Want to know how to orchestrate Identity for successful outcomes? We can show you live demos of these journeys. ForgeRock is here to help.