Financial institutions (FIs) continue to place a greater emphasis on enabling new account-opening growth through online and mobile channels, and expand their product offering to foster financial inclusion and growth. In my recently published study New DDA Strategies: Balancing Risk and Regulators, over 40% of FIs in every category with the exception of the largest FIs already offer some type of second chance account. While only 17% of the largest FIs currently offer second chance accounts, another 17% are planning to do so and 50% are evaluating whether to do so.
Online Account Opening Growth in 2017
We can all agree that the “bank of the future” will look and act differently than traditional brick-and-mortar institutions, but just how distant is that future? While we’ve seen account openings begin to shift away from the branch, Aite Group reports that by next year, 28% of new accounts will be opened online and 8% will be opened on a mobile device (an anticipated increase of 5% and 2% from 2015, respectively).1 In an increasingly faceless environment, validating a consumer’s personally identifiable information, their devices and related risk is vital to ensure the optimal customer experience as well as safety and soundness in the financial system. Are you ready for this shift?
Balancing New Account Growth and Risk Mitigation
Although financial institutions (FIs) have been screening new account applicants for decades, guidelines for how to best utilize that decision-making data has become increasingly scrutinized in an effort to ensure consumer fairness and financial inclusion. Not only have the variety of data sets available to FIs today versus even five years ago advanced significantly, but so too has the sophistication of the consumers applying for new accounts.
As account opening continues to expand to online and mobile channels, institutions continue to tailor product offering to meet the needs of the consumer, validating identity and risk has become increasingly complex. Learn more about how to improve the digital identity assessment process with this infographic.
Find out where we'll be, what we've got planned and how to connect with us!
Are you ready for this year’s Money20/20 event? We hope you’re as excited as we are for the world’s largest payments and financial services innovation event! We can’t wait to show you what we’ve been working on since announcing our acquisition of clearXchange at Money20/20 last year!
Following is everything you need to know about what we have planned for the conference, and how you can connect with us.
Traditional methods of verifying borrowers’ liquid assets continue to cost lenders millions each year – not to mention, this process is growing increasingly susceptible to financial misrepresentation and fraud. Early Warning will be at the 2016 MBA Annual Convention and Expo October 23-25 in Boston, showing lenders how they can transform the lending experience for borrowers while lowering costs and risks.
Improve Retail Initiatives, Debt Collection and TCPA Compliance
Whether conducting outbound calls or texts for any purpose - including growth strategies, notifications, debt collection, etc. - increasing institutional and regulatory pressures contribute to the challenges organizations face in optimizing their customer calling strategies. And no surprise here, risk reduction and compliance will continue to be a leading strategy for organizations in 2017.
The traditional loan origination process is well-known for including several manual, paper-based underwriting steps that cost borrowers in time (and stress) and lenders in resources. According to a recent J.D. Power Survey, 68 percent of customers have to provide additional documents after completing the loan application process, and 48 percent of customers were asked to provide the same document more than once. The outdated process isn’t just costly for the borrower. MBA’s Quarterly Mortgage Bankers Performance Report found that inefficiencies in the home loan origination process drove personnel expenses to an average of $5,131 per loan in the fourth quarter of 2015, compared to $4,674 per loan in the third quarter of that same year. Loan production also stalled to 2.4 loans originated per production employee per month.
Industry Dialog on SMS OTP Picks Up
In last month’s blog, we touched on the latest draft of the Digital Authentication Guideline (DAG) (open for public preview) from the United States National Institute of Standards and Technology(NIST), discouraging companies from using SMS-based authentication as a form of out-of-band (OOB) authentication. We shared insight from Al Pascual, senior vice president, research director and head of fraud & security at Javelin via his blog No, SMS OTP Isn't Dead.
The term “Digital Identity” has been popularized to link a consumer to his or her transactions online. The definition itself varies by generation, signifying the important evolution taking place. Millennials tend to associate their digital identity to online activities, social media data or biometric information while their predecessors tend to classify personally identifiable information such as a Social Security number, Driver’s License information and banking identity information as the core elements that make up their identity credentials. In truth, a consumer’s digital identity has evolved to encompass all of these things and more.