Signicat in the news - research on bank on-boarding

Money 20/20 is about the ongoing changes in financial services, what was significant for your company in attending Money 20/20? 

Our main focus at Money 20/20 was launching our research into bank on-boarding – financial services are increasingly digital but on-boarding in many parts of Europe is still an analogue process. Our research found that the on-boarding process led to many potential customers abandoning their applications, either because it took too long (39%) or because too much personal information was required (34%). Both retail banks and fintech providers need to put a lot of time and effort into attracting customers, so they need to know that on-boarding is the weak link in the chain – 40% of potential applicants are abandoning the process at this vital step. Money 20/20 Europe, a new spin-off from the successful Las Vegas event, was very well attended by financial technology innovators so was a great event to launch our research and announce our partnership with mobile payments innovator Auka.

What are the issues and challenges you are finding in the industry and how are you providing solutions? 

Our research showed us exactly how big a problem on-boarding is for financial service providers – both the incumbent banks and the fintechs that are challenging them. For banks the challenge is May 2016 Interview 27 taking a process that has always been a manual and paper-based and making it digital alongside all other processes. For fintech providers the challenge is meeting inflexible KYC and Anti Money Laundering regulations. Financial institutions need to drastically reduce the time it takes to on-board new customers, and fintech challengers need customers to trust them as much as they trust current providers. Solving this isn’t simple, as existing ID solutions are impossibly complex, needlessly expensive and divorced from digital banking. What Signicat offers, as the first and largest Identity Assurance Provider in the world, is to make identity into an asset rather than an obstacle for financial institutions. Signicat has the largest eID market coverage in the world, and acts as a single cloud-based integration point to multiple ID ecosystems. Physical, paper-based on-boarding is replaced with digital on-boarding using existing ID credentials, and these credentials can be reused for all services. Customers expect to enact most transactions with a single click – establishing trust needs to be a single click too. The challenge of on-boarding is part of a bigger problem faced by banks, which is that they are struggling to offer everything digitally – at some point paper documents need to be used to record an agreement. To that end we also offer digital signing that not only creates a legally-binding document with a record of who signed and when, but also records whether the document has been modified after signing. This is possible not only with an identity issued by Signicat, but also eIDs from Norway, Sweden, Denmark, Finland, Spain and Estonia. 

Going forward what are the trends and advancements that we should expect to see in financial services? Governments will continue to target money laundering as a high priority, and it will fall on financial services providers to bear the cost of additional checks and ensure processes meet regulatory requirements. At the same time regulators will continue their mission to make account switching easier in order to stimulate competition in the market. Again, financial service providers will be required to meet the costs of additional schemes to make this happen. The only solution is to use digital identity. We don’t necessarily need to create a new digital identity scheme, but it will be necessary to build bridges between existing eID schemes. The blockchain and distributed ledger technology also has a lot of buzz around it and is proposed as a solution to several issues, and identity could be one of these. A distributed ledger would enable identity to be built up of individual uses of a person’s identity, be totally unforgeable and increase speed and ease of use for services. And an infallible eID system would mean a far better level of trust and convenience for both consumers and financial organizations.