Originations, evolved: Blending digital and banker touch for modern retail banking
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This content has been created by the Finextra editorial team with inputs from subject matter experts at the funding sponsor.
Retail banks stand at a crossroads. To win the trust and loyalty of next-gen customers, they must transform onboarding and origination into a seamless, customer-centric journey that balances digital convenience with human expertise. The time to act is now: those who prioritise the customer will lead the future of retail banking.
Winning next-gen customers involves offering onboarding and origination that delivers seamless, proactive customer-centric experiences by blending the convenience of digital self-service with the expertise of banker engagement.
Further, these digitally-enabled self-service and human assisted capabilities must be powered by automated data capture and propagation, rapid processing and decision-making to reduce drop-offs, transparency throughout the application lifecycle, and regulatory compliance – efficiently and at scale.
Alongside this, with AI being increasingly leveraged in all areas of business, banks must also consider leveraging subsets such as machine learning and generative AI for use cases embedded within processes and workflows to offer insights, predict outcomes, and enhance decision-making.
Banks need to integrate technology in a smart way to offer fast, frictionless, and personalised origination journeys that meet modern customer expectations and operational needs.
The rise of the 'You Ought to Know' customer
The era of 'instant service' as a differentiator is over; it is now table stakes. Today's competitive banking environment demands a shift beyond just responding to immediate requests. The new imperative is 'you ought to know' -leveraging data and insights to proactively anticipate customer needs and deliver hyper-personalised experiences that are digital-first and convenient. While digital self-service options are valued, customers still expect personalised guidance when navigating complex financial decisions and seamless engagement across multiple channels – and that's online, mobile and in-person.
Financial institutions must evolve to understanding prioritise understanding customers' individual needs and wants and offer tailored financial products and advice that align to these unique requirements. Proactive solutions are the future, and in addition to consistent and convenient engagement across different channels, decision-making needs to be fast, processing, automated, and paperwork, minimal.
Whether through self-service or with assistance, today's banking customers expect proactive engagement with clear, real-time visibility that goes beyond real-time updates. Accustomed to instant notifications, they now anticipate their banks will proactively provide relevant information and insights. Furthermore, this expectation of proactive support extends to human interactions, where customers seek knowledgeable representatives who anticipate their needs and offer solutions before being explicitly asked.
All of this requires a seamless customer-centric origination journey that blends the efficiency of digital self-service with the expertise of banker engagement, all while ensuring speed, transparency, regulatory compliance, and scalability.
What a seamless customer-centric origination journey looks like
From a retail banking customer's experience, a seamless origination journey is fast, smooth, effortless, and consistent. The journey should have these characteristics from initial awareness to final purchase or registration. Friction must be minimised at every touchpoint – digital or assisted – and only relevant information must be provided at each stage to deliver high-conversion origination journeys.
Digital self-service: Customers expect origination journeys to be effortless and on their terms. Intuitive, mobile-first platforms are no longer a luxury but a necessity, allowing them to apply for accounts, loans, or credit cards whenever and wherever they choose.
Human assisted: While digital tools offer convenience, customers often value the reassurance and expertise of a human touch, especially for complex products or significant financial decisions. They might begin an application online but appreciate the option to easily connect with a banker for clarification on intricate mortgage details or investment choices.
Recognising that today's banking customers expect proactive engagement that anticipates their needs, a truly seamless origination journey must hinge on a fluid interplay between digital self-service and banker-assisted engagement. Customers expect the convenience of initiating applications anytime, anywhere through intuitive online and mobile platforms. However, for complex queries or when seeking personalised advice, a frictionless transition to knowledgeable human support that proactively offers relevant insights and solutions via channels like video calls or live chat is paramount. This synergy, where digital tools empower initial steps with anticipatory insights and human expertise provides tailored guidance that pre-empts customer concerns without requiring customers to restart their journey, builds trust, enhances efficiency, and drives successful originations.
To achieve this, banks must focus on five critical capabilities, as detailed below:
Five pillars of seamless origination
Omnichannel integration: Banks must ensure a smooth and consistent experience across all channels (online, mobile, in-branch, phone, etc.), allowing customers to start in one channel and seamlessly continue in another without losing progress or having to repeat information. Personalisation at scale: Banks can leverage machine learning to segment customers, personalise product offers, and predict optimal times for outreach, as well as use generative AI to analyse applications, compare scenarios, and suggest tailored recommendations in real-time. Automated data capture and propagation: Banks can leverage existing customer data to pre-fill forms with optical character recognition (OCR) and natural language processing (NLP) in an automated manner, and so customers are not asked for the same information twice. Real-time decisioning and processing: Banks can reduce turnaround time with AI-powered credit scoring and automated underwriting, which in turn, will reduce drop-offs and improve customer satisfaction. Transparency and control: Banks can allow customers to feel in control of their origination journey by providing real-time status updates, proactive notifications, and digital tracking tools.
The role of AI and automation in reducing drop-offs
Expanding on the benefits of AI and its subsets, there are ample opportunities for banks to adopt technology to reduce drop-offs and improve conversion. Using the lending market as an example, machine learning can help segment customers and tailor loan offers to customer profiles. This will boost conversion through personalisation, as discussed.
However, the introduction of generative AI has the potential to transform the origination journey. Again, using the lending market as an example, this form of AI can support qualitative analysis of a loan application. By speeding up holistic application reviews, minimising delays and in turn, approvals – customers are not exposed to uncertainties for a long period of time.
Generative AI can also help banks optimise loan terms by comparing applications, lowering abandonment, and improving acceptance. Further, with loan application tracking, transparency is enhanced with real-time updates and encourages completion. If these elements are operating as automated as they should, customers should not need to speak to a customer service representative.
Measuring what matters
What does success look like? What are the key metrics that banks should use to measure the success of onboarding and origination? By considering metrics, insights into the efficiency and effectiveness of the process can translate into future improvements and increased client satisfaction. Here are key metrics that can help inform future innovation and progress:
Percentage of customers who successfully complete the onboarding or origination process.
Average time taken from initiating to completing the onboarding or origination process.
Percentage of customers abandoning the process at specific stages.
Average operational cost to onboard a single customer or originate a product.
The higher the percentages are and the lower the average time to first value is, banks can use these metrics to measure how quickly new clients experience the bank's services, as well as reveal potential bottlenecks and areas for improvement.
Scaling with confidence
By strategically blending digital efficiency with the indispensable human touch, banks can transform and scale their origination processes with unprecedented confidence and deliver meaningful proactive engagement. Prioritising customer trust, operational resilience, and continuous technological innovation fuels this evolution. Seamless omnichannel integration ensures a consistent customer journey across all touchpoints. Scalable personalisation with AI delivers tailored offers and real-time recommendations. Automated data capture using OCR/NLP minimises effort and repeated requests. AI-powered real-time decisioning accelerates processing and improves satisfaction. Transparency and control through updates and tracking empower customers, Alongside this, by minimising repetitive tasks, delays and miscommunication, and proactively meeting customer needs, banks can create a 'click-to-close' origination experience that meets demands for proactive engagement with speed, transparency, and personalisation.
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