Moving checking account opening into the digital world

08 April 2015

In an increasingly digital world, US consumers have developed an appetite for mobile and online based bank interactions, research by Javelin Strategy & Research shows. With the development of technology now allowing for online accounts to be opened digitally, the ‘physical world’ appears to be receding in prominence – although privacy concerns continue to drive people to the branch.

Americans have developed a taste for the convenience of digital when it comes to their checking account and banks are diversifying the number of channels through which to reach customers to accommodate this preference, reports by Bain & Company (read: Mobile banking expands omnichannel loyalty) and A.T. Kearney (read: Banking transitioning to a digital world) found. A recent survey from Javelin Strategy & Research, based on over 3.100 American consumers, indicates that banks are actively encouraging their customers to complete basic transactions through mobile and online channels. The branch is now a place at which to get expert advice on purchasing financial products.

Preference of American consumers

Relying on digital
The research shows that the preference of digital over face-to-face even goes further than balance checks and basic transactions, with close to three quarters (70%) of people planning to open a checking account in 2015 indicating their preference to do this digitally rather than at a branch. An example of a bank allowing consumers to open an account this way comes from the Lloyds Banking Group in the UK, which, last month, introduced a service for customers to upload photos of identification documents for online account opening.

According to Javelin Strategy & Research, the option of the personal experience continues to be important and the opening of a checking account will likely continue to require in person opening. The way in which American consumers expect to be able to engage banks, however, is changing. With more and more access to mobile devices, the volume of application through smart phones and tablets was as high as almost 50% for checking accounts in 2014, and increased more than 60% for auto loans, mortgages, and credit cards.

Javelin Strategy & Research

Personal touch
Branches continue to enjoy some perceived advantages however, over a purely digital account opening. In the survey almost 69% believes that branches are more secure in terms of protecting their personal information and 60% that the personal face was better for getting their questions answered.

Mark Schwanhausser, Director Omnichannel Financial Services at Javelin Strategy & Research, concludes: “Financial institutions will win by ensuring that applicants feel the outcome was smooth and seamless even if even if they start the process in one channel and finish in another. Applicants should never have to start over from scratch."


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