6 Fintech Client Onboarding Strategies for Impactful Customer Journeys

What are some apps you use every day?

Are you a fan of some of the classics that help with mobile banking, and payment & or are you one of those sole traders that love stock trading? 🤓

If so, that means you are using at least one of Fintech's products on a daily basis.

Whether you love using Venmo, from the banking industry, Paypal, Moneylion, or Coinbase, the bottom line is that Fintech is doing ✨something right✨ with its product strategies - and the Fintech onboarding programme that millions of people seem to love. 

Today, I will be unpacking 6 Fintech Client Onboarding Strategies, and you will be learning:

• Why customer onboarding is crucial in Fintech 📣
• What some of the best practices are 📣
• And how an average Fintech customer onboarding works 📣

Don’t have the time? Here’s a quick recap of the Fintech onboarding programme ⬇️ 

TL;DR

• Client onboarding is a critical component of success in the fintech industry. It helps fintech companies meet regulatory requirements, build trust, reduce risk, and create personalized digital experiences that lead to increased adoption and customer retention.
  
• It also plays a pivotal role in maintaining a competitive edge in the rapidly evolving fintech landscape.
  
• Some of the best practices for an effective client onboarding process are offering streamlined documentation, automated workflows, adoption of a tool, using AI and machine learning, and a personalized touch that ensures each client’s specific needs and preferences are heard and valued thanks to modern technology.
  
• PayPal, one of the most popular Fintech products, has an onboarding process that is user-friendly, and mobile-responsive and it minimizes friction by starting with minimal required information and gradually requesting more as legitimate users progress.
  
• It uses clear language and instructions to create an intuitive experience unlike that of conventional banks. 
  
• However, PayPal can improve onboarding by reducing friction, making it more personalized to different user types, and enhancing education through tooltips and educational content, particularly for complex services like advanced analytics provided by PayPal for Business.

Let's now get to it right away. 

Why is Client Onboarding Crucial in Fintech?

A poor onboarding experience is hard to come back from and is the fastest way to lose a customer. It’s critical to actively think about the entire customer journey – define it, map it, document it. ‘’

Paul Philip 

You heard it here first, fellas. 

And the future of client onboarding is no different with Fintech's financial services firms. 

1- Compliance and Regulatory Requirements 📌

Fintech companies often deal with sensitive financial account data and must comply with strict regulations and Know Your Customer (KYC) requirements.

Proper onboarding & business processes help ensure that customers meet these compliance standards and reduce the risk of fraud and financial crimes.

2- Trust and Credibility 📌

Establishing trust is essential in the financial sector.

Effective onboarding & business processes help build trust by providing a smooth and secure experience for customers with financial accounts. When customers trust a fintech platform, they are more likely to use its services and share their financial information.

3- Risk Mitigation 📌

Fintech companies need to assess the risk associated with each customer to determine factors like creditworthiness and potentially fraudulent activities.

Onboarding allows fintech firms to collect the necessary data and conduct risk assessments to protect themselves from financial losses.

4- Personalization 📌

Fintech platforms can use onboarding to gather information about retail customers' financial goals, preferences, and needs.

This data can then be used to offer personalized financial products and services, enhancing the overall customer experience with personalization.

5- Efficiency and Cost Savings 📌

Streamlined onboarding processes reduce the customer onboarding time and resources required to onboard new customers.

This efficiency results in cost savings for fintech companies & financial service providers, and a quicker time-to-revenue for acquiring new customers.

7 Best Practices to Look Out For In Fintech Client Onboarding

1- Adopt a Tool

Introducing tools as part of the onboarding process can streamline various tasks and make the process A LOT more efficient. 

You can always use tools for authentication flow and the identity verification process, document submission, e-signatures, money management, account setup, and more.

❗️Tools can ensure that all customers go through the same standardized process, reducing the risk of errors or omissions.

This is particularly important in regulated industries like finance, where compliance is crucial.

Furthermore, well-designed tools can enhance the overall user experience by making tasks easier and more intuitive. This can lead to higher customer satisfaction and reduce the lengthy customer onboarding process. 🚀

For more information and a more profound approach to client onboarding, you can check out my article called Top 33 SaaS Products That Will Make Your Life Easier.

2- Use AI

Using AI (Artificial Intelligence) during customer onboarding can be a highly effective and innovative approach to client onboarding, offering several advantages when implemented correctly.

Here's how AI can benefit the onboarding process:

💡 Enhanced Personalization

AI can analyze customer data to create highly personalized onboarding experiences.

By understanding individual preferences and needs, AI can tailor the onboarding journey, making it more relevant and engaging for each customer and transaction profile.

💡 Automation of Repetitive Tasks

AI can automate many routine and time-consuming tasks, such as data entry, document verification, and form filling.

This not only reduces human error but also speeds up the effective onboarding process.

💡 Improved Customer Insights

AI can analyze customer behavior and interactions during onboarding to gain insights into their preferences and pain points.

This data can be used to refine the effective onboarding process continually.

💡Chatbots and Virtual Assistants

AI-powered chatbots and virtual assistants can provide instant support and guidance to customers during onboarding.

They can answer questions, assist with form completion, and offer a more interactive experience.

💡 Risk Assessment and Fraud Detection

AI can help detect risk statuses and prevent fraud losses & false fraud alerts during onboarding by analyzing patterns and risk statuses in customer data.

This enhances trust in the process. Which, you know, is the key differentiator above all. digital onboarding process

3- Use Biometric Verification

Using biometric verification during customer onboarding to detect erroneous fraud attempts is a cutting-edge and secure approach that has gained popularity in various industries, including fintech.

👉🏼 Biometric verification involves the use of unique physical or behavioral characteristics to confirm a person's true identity through multi-factor authentication activity.

Digital identity verification, such as fingerprint, facial recognition, or voice recognition, offers a high level of security and deep learning as they are difficult to forge or replicate.

This type of approach eliminates the need for customers to remember and input passwords or PINs, making the onboarding process more convenient and user-friendly. 

4- KYC and AML Compliance 

KYC (Know Your Customer) and AML (Anti-Money Laundering) compliance are critical components of the customer onboarding process, especially in the financial services and fintech sectors.

👉🏼 KYC involves verifying the identity documents of customers to ensure they are who they claim to be. This typically includes collecting government-issued identification, such as passports or driver's licenses.

KYC also includes assessing the risk associated with each customer based on factors like their financial history, source of funds, and business activities. Customers with a potential risk may undergo more rigorous checks and pay harsh fines if they are to be found guilty.

👉🏼 AML compliance involves detecting and reporting suspicious activities that could indicate any kind of affiliation with money laundering or terrorist financing. Fintech companies are obligated to report such activities to relevant authorities in the financial market unless they are willing to pay harsh fines.

Having said that, digital platforms often employ automated systems to monitor customer transactions for unusual affiliation with money laundering or large cash flows that might indicate this type of illicit activity.

❗️Fintech companies must stay up-to-date with evolving KYC and AML regulations in the regions where they operate and adapt their digital onboarding process accordingly.

5- Automate Onboarding

💡 Onboarding automation allows fintech companies to streamline complex onboarding & business processes. Tasks that were once manual and time-consuming, such as data entry and document verification, can be automated, reducing the risk of errors and speeding up the process in all digital channels.

Plus, automation significantly reduces the client onboarding time.

This can lead to higher customer satisfaction, as legitimate users appreciate a quick and efficient onboarding experience.

To try it yourself, select automation tools and software that align with your onboarding needs. Look for solutions that are user-friendly, integrate well with your existing systems & digital services, and offer the features you require.

💡Share educational content such as knowledge bases, tutorials, and guides to support self-learning in digital channels.

Offer comprehensive in-app training sessions to help private clients understand how to use the product or service effectively.

You don't really know how to do all these? I've got you covered.

Do it No-Code, In Minutes 🌟

Instead of relying solely on manuals or documentation, clients can immediately familiarize themselves with the online platform’s features through guided tutorials and interactive product walkthroughs.

And when it comes to implementing them, UserGuiding comes to the rescue.

UserGuiding is a code-free user onboarding software for web products. It provides numerous onboarding automation elements such as:

👉 Interactive product walkthroughs,

👉 Feature highlights,

👉 Onboarding checklists,

👉 NPS surveys,

👉 Resource centers, and so much more.

If you also want to offer a better and stronger client onboarding process for your customers and increase your feature adoption rates and retention, you should take a look at UserGuiding’s no-code tool.

Schedule a demo with one of our experts or...

👉 Start your free trial now 👈

6- Conduct A/B Testing

A/B testing, also known as split testing, is a crucial practice in customer onboarding, product development, and customer experience optimization.

It involves comparing two versions (A and B) of a webpage, email, or user interface to determine which one performs better in terms of a specific goal or metric.

 💡 A/B testing can help fintech companies optimize their landing pages and sign-up forms to encourage more users to start the entire process. Testing different headlines, images, form fields, and call-to-action buttons can provide insights into what resonates best with your target audience.

👉🏼 A/B testing can be used to refine the UI and UX of the onboarding process. For example, you can test the layout, design, and navigation of the onboarding screens to ensure a smoother and more intuitive experience for users.

Fintech Client Onboarding Process Example 

PayPal Onboarding: A Teardown

💡 Good Practices

Clear Value Proposition ✅

PayPal typically does a good job of communicating its value proposition during endless flows of onboarding. Users are informed that they can send and receive money securely and conveniently.

Progressive Disclosure ✅

PayPal often begins with minimal information required for registration, such as email and password, and then gradually requests more details as users proceed. This minimizes initial friction in endless flows.

Mobile-Friendly Design ✅

PayPal's onboarding process is generally mobile-responsive, recognizing that many users access the service on their smartphones.

User-Friendly Interface ✅

PayPal maintains an intuitive and user-friendly interface throughout the onboarding process, using straightforward language and clear instructions.

Security Emphasis ✅

PayPal emphasizes its security measures during onboarding to detect erroneous fraud attempts, reassuring users about the safety of their financial transactions.

Verification Process ✅

PayPal employs a verification process to confirm the user's identity, which is a crucial step in maintaining security and trust and, therefore excellent service.

✍🏼 Potential Improvements 

Reducing Friction 🛎️

While PayPal has improved its onboarding over the years, there is always room for further streamlining and simplification to reduce friction and drop-off rates.

Personalization 🛎️

PayPal could enhance the onboarding experience by tailoring it to the specific needs of a different type of client, such as a personal account holder, a business account holder, or a freelancer.

Education 🛎️

Providing educational content or tooltips during onboarding could help users better understand the various features and capabilities of PayPal and understand its value as a sophisticated machine, especially for more complex services like PayPal for Business.

Speaking of which, here's how you can easily come up with educational content and compliance management panel tooltips with the help of UserGuiding: 

UserGuiding is the best, user-friendly onboarding platform that there is!

See it for yourself. 

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To Wrap Up...

In today's fintech landscape, where customer loyalty is paramount, the future of client onboarding is the critical gateway to building lasting relationships for financial service providers.

As revealed by industry experts, financial service providers, and PwC's research, nearly 77% of clients in the market share acknowledge its pivotal role in their choice to remain with a company or explore alternatives.

By adopting the six strategies discussed in this article, fintech companies can craft seamless, engaging, and impactful customer onboarding technology during the onboarding process and compliance management, ensuring a strong foundation for lasting success! 🚀