For both consumers and companies, speed is the critical element in the digital onboarding experience. In a world where nothing online seems to take longer than a few seconds, consumers expect instant approval for a new credit card, bank account, and any type of online service. With an eye on rapid customer growth, companies would like that too. The path to achieving unprecedented speed is to reduce speed-killing friction in the identity verification process.
Fraud and customer experience leaders recognize the incredible economic value in delivering a frictionless onboarding experience — the speedier the process, the faster that new customers can begin using services and spending money. But the inescapable fact is that preventing fraud and protecting valuable data and IP demands rigorous digital identity verification, and there has historically been some level of friction in that process.
The Need for Speed: Onboarding in the Age of Digital Consumer Expectations and Fraud Challenges
Today’s consumers have little tolerance for any delay in their quest to transact. The fast-paced nature of modern life and the high expectations set by technological advancements have created a dynamic where registration process speed is no longer seen as simply part of the customer entry point. Because consumers hold in their power the ability to abandon the process as soon as they’re dissatisfied, it is perhaps the most important part of the customer journey. If your registration process doesn’t comply with their demands, they will bail before you’ve even had a chance to engage with them.
Companies want speed too. Any organization doing business online operates with aggressive customer growth targets, and speed of acquisition, at the point of onboarding, is the most important aspect of their growth strategy. Speed doesn’t just put new customers in front of a “buy” button. For customer experience teams, each new customer offers more data about consumer behavior and trends. More customers increase the word-of-mouth impact of a great customer experience.
Think about the opportunity inherent in rapid customer acquisition. Major banks can earn more than $5 billion quarterly on net interest income (the difference between the revenue generated from a bank's interest-bearing assets and the expenses associated with paying on its interest-bearing liabilities). It behooves the banks to get the customer’s money into accounts as fast as possible so they can start earning money on it. Delays in creating a customer and enabling her to be actionable results in lost revenue. Rapidly providing customers access means a faster path to greater revenue.
While the need for speed governs the customer-focused aspect of onboarding, there is a presupposition by fraud and risk leaders that sometimes fraud defense is sacrificed in order to eliminate friction. And quite often, they’re right.
The rise in digital adoption as well as the AI renaissance has opened the door to new and more sophisticated forms of fraud, underscoring the importance of coupling identity verification and fraud management with the need to meet customers' escalating expectations for seamless digital experiences.
Digital enterprises find themselves inundated by the sheer volume of fraud attempts. In the financial services/fintech sector, for instance, banks face an overwhelming onslaught of fraudsters. This leads to difficulties for financial institutions in meeting online origination targets and struggles in verifying identities and authenticating customers while combating fraud.
Simultaneously, the threat landscape has evolved, with fraudsters employing increasingly sophisticated tactics. From nation-state actors and organized criminals to cyber terrorists and insider threats, the range of potential culprits has expanded. Technological advancements have further complicated matters, as fraud attacks now occur more frequently, rapidly, and with heightened effectiveness. Among the common methods employed are phishing, destructive malware, social engineering, deep fakes, and the use of fraud-as-a-service exploit kits.
Prove Pre-Fill®: Balancing Consumer Experience and Fraud Prevention in Identity Verification
Most identity verification solutions treat the issue as an either/or prospect, as in, deliver a fast consumer experience or prevent fraud – take your pick. With Prove Pre-Fill for identity verification, companies can achieve both.
Prove Pre-Fill balances the needs and demands of consumers, growth leaders, and fraud teams by authenticating digital identities so that the data being used for verification is directly applied in the onboarding process. In other words, it enables applicants to populate forms by consenting to auto-filling registration fields with their own information that’s already been verified. Consumers save precious time and companies get the advantage of a proven method of reducing fraud. The outcome is a vastly better onboarding experience and a stronger, more accurate way of identifying “good” customers.
It’s Time to Stop Burdening Consumers with Onboarding Tasks
Most legacy identity verification solutions were not built with the customer experience in mind. As a result, their processes are built on the inherent tension between what the consumer wants and the safeguards the company must provide.
These types of solutions require heavy involvement from the consumer – the very person they’re trying so hard to recruit. The burden is on the consumer to provide detailed personal information, which then has to be validated. The person sits idly while a determination is made. If additional data is required, she or he is on the hook to provide documents, biometric authentication, or other data points in additional stages in the process.
Is this too much to ask of consumers? Apparently, yes. A 2021 survey of financial services customers discovered that 63% of online applications were abandoned for a wide variety of digital account types. According to the study, the primary reasons for bailing on the registration process included frustration at the excessive amount of personal information they were required to enter and the time-consuming nature of filling out forms.
The onboarding process is, in many ways, backward. Consumers are required to drive the process, yet because of information available through a wide array of trusted identity sources, the information they’re supplying has already been validated and is readily accessible. Time-strapped and easily distracted consumers are being asked to wait in line for the privilege of doing a lot of work, only to have to get into another line and wait a little longer. This is elongating the onboarding time frame, it’s creating frustration, and it’s giving consumers a reason to go elsewhere – usually to a competitor.
The Limitations of Traditional Identity Verification Approaches
The problem of friction in the onboarding process stems from a misalignment of purpose and reality in identity verification. Most legacy identity verification solutions simply aren’t capable of accurately detecting fraud because of limitations in their design and purpose. Many were created to approach the problem of identity verification as a binary one – the identity is or isn’t authentic. They simply aren’t thorough enough in their detection, or they rely on limited data sets that feed their AI models. As a result, there’s a lack of rigor in how they orchestrate the process of authenticating an applicant’s PII.
Unsophisticated solutions require either too much time to process information or demand step-up methods like additional documents or biometric verification. They can ultimately deliver a pass/no pass decision, but the friction involved demands customers to keep filling out new fields, uploading documents, or sitting through facial detection screens. As we know, each additional step drives away more customers
Many legacy solutions rely on static data checks, which involve comparing user-provided information against databases of known fraudulent identities or stolen data. While this approach can catch some basic cases of fraud, it is limited to identifying only previously known fraudulent identities, leaving room for newer and more sophisticated fraudulent tactics to go undetected. The issue is that they aren’t performing persistent modeling with new data sources, which limits their ability to detect patterns and inconsistencies that would normally indicate things like synthetic fraud.
These legacy solutions create excessive friction, redundant data entry, and time-consuming verification processes. Customers who expect a seamless and efficient onboarding journey are instead confronted with a seemingly endless set of steps, leading to frustration and potential abandonment of the onboarding process. The inability to detect evolving fraud tactics exposes both customers and businesses to increased risks, undermining the sense of security that should come with an identity verification process built to align with the customer experience.
Pre-Fill Changes the Game for Both Onboarding and Fraud
The Prove Pre-Fill solution has changed the dynamic of the entire onboarding experience by providing consumers with already-authenticated data points. The customer’s job is simply to validate it. This patented process leverages billions of real-time signals pulled from authoritative, phone-related sources to build deep and consistent identity profiles.
The approach is built around the information from a consumer’s phone. As 99% of consumers own a personal phone number, the Phone-Centric Identity approach enables Prove to authenticate and verify an individual based on their possession of the phone (using the 128-bit encryption that is bound to a mobile phone) and the behavioral-based reputation profile that enables Prove to assess user risk. That information is combined with other consumer-provided information such as name, address, phone number, and email to enable swift and seamless authentication. It ensures a fast, smooth user experience while ensuring accuracy from identity checks.
To power this process, Prove Pre-Fill uses cryptographic authentication which ensures that only information that is verified with trusted data sources is auto-filled. That accomplishes the following key aspects of the identity verification process:
- Automatically populate online forms with verified consumer data from reliable and trustworthy sources.
- Authenticate consumer identities to effectively combat account opening fraud, including the ever-growing threat of synthetic identity fraud.
- Provide users with a faster, more secure, and consent-driven sign-up process that enhances their overall experience.
Prove Pre-Fill delivers a new type of onboarding experience, where the consumer’s onboarding forms are, you guessed it, pre-filled (also known as auto-populated). The information used to pre-fill has already been verified using authoritative sources; the consumer just has to confirm or edit the answers.
A fraudster trying to auto-fill a form with stolen or phony information is now faced with two options, both of which create additional layers of complexity to their processes. For one, their ignorance of a user's actual information means they would be unable to accurately validate the pre-filled answers. Secondly, the process creates a barrier that’s simply too hard for fraudsters to overcome, so they opt out of the process. In fact, we’re seeing only about a 0.03% fraud rate in Prove Pre-Fill experiences.
Also enabling a faster, less onerous onboarding experience are KYC and AML checks that are natively integrated with Prove Pre-Fill, which enables companies to eliminate the complexity of managing multiple solutions and vendors. In fact, Prove Pre-Fill incorporates many KYC checks at no extra expense and maintains regular updates with a comprehensive range of data sources. This ensures consumers have a seamless and precise method to comply with stringent KYC regulations while expediting the digital onboarding process with minimal friction.
Transforming Customer Onboarding and Fraud Management Across Industries
The innovative approach leveraged by Prove Pre-Fill is solving the customer onboarding experience and fraud management needs of companies in a variety of sectors, ranging from finance/fintech and digital banking to healthcare and e-commerce. The numbers, of course, offer proof points that align with the goals of both customer experience and fraud teams and are unavailable by any other solution. To note, Prove customers are achieving:
- 79% faster customer onboarding experiences
- 35% reduction in registration abandonment
- 90%+ applicant pass rate
Researchers at Aite-Novarica evaluated the efficacy of Prove Pre-Fill after being implemented at a leading healthcare company. In this case study, before implementing Prove Pre-Fill, the company faced limitations in onboarding new patients to its digital portal due to state legislation requiring in-person appointments for new patients. However, in 2019, a change in legislation enabled healthcare providers to onboard new patients digitally, prompting the company to seek a new onboarding solution. Their top priorities were efficiency and ensuring a great customer experience.
“Fraud prevention professionals are often challenged with the level of friction that their risk controls inject into the end-to-end customer life cycle so as not to significantly disrupt the customer experience,” said Jim Mortensen, Strategic Advisor at Aite-Novarica Group. “Prove’s Pre-Fill solution is well-positioned to address these challenges with its ability to both authenticate individuals and markedly reduce friction through its auto-fill capabilities.”
The company adopted Prove Pre-Fill specifically because of its ability to automatically fill new patient registration forms with verified bank-grade data, which significantly reduced the number of keystrokes required for customer onboarding by almost 80%. Key to their decision to use Prove Pre-Fill was the seamless process that only asked customers to enter the last four digits of their Social Security number, while the remaining data was auto-populated with the customer’s consent. Most healthcare companies require more than a dozen fields to be completed.
After integrating Prove Pre-Fill into its system, this healthcare company witnessed a staggering 151% increase in new patient registrations. By combining efficiency with an exceptional customer experience, Prove Pre-Fill enabled the company to expand its patient base, streamline its digital onboarding process, and reduce instances of fraud.
The Ideal Onboarding Experience: More (and happier) Customers + Less Fraud
In the digital world, immediate access to services and products is critical for companies to achieve ambitious revenue targets and establish brand leadership. Economic growth and the delivery of vital services rely on providing access to "good" customers swiftly and efficiently while preventing access to “bad customers” (i.e. fraudsters). With Prove Pre-Fill, consumers have less work to do, and they experience practically zero friction. Enterprises use Prove Pre-Fill to support ambitious customer growth targets while being able to rely on sophisticated decisioning to reduce fraud.
Want to accelerate onboarding, acquire new users quickly, reduce abandonment rates, and prevent fraud? Speak with a digital identity solutions expert today.
Notes
- HubSpot: “Live Chat Exposes a Fatal Flaw in Your Go-to-Market”
- Salesforce: “State of the Connected Customer”
- Javelin: “Overhauling the Mobile Account Opening Experience”
- Signicat: “The Rise of Digital Identities”
- SaleCycle: “[Infographic] The Remarketing Report”
Keep reading
Developers know identity verification is an essential element of effective digital onboarding and the customer lifecycle. Choosing the right one can feel like navigating a maze of features and complexity.
In an age where our smartphones have become almost like extensions of ourselves, the identity assurance achieved through smartphone possession and data is a natural evolution.
Rodger Desai, CEO of Prove, a leading identity verification solution provider, offers a unique perspective on the rising fraud in the gig economy, advocating for robust digital identity verification as a key defense mechanism.
