A new research has found that retail banks in Europe lose nearly 52% of the prospective customers during the on-boarding stage, a surge of 35% in the last two years.
The Battle to On-Board II report, commissioned by digital identity provider Signicat and conducted by Sapio Research, focuses on digital identity and its effect on retail bank on-boarding in the European countries of the UK, Germany, the Netherlands, and Sweden.
It carried out a similar research two years ago.
All the banks must carry out Know Your Customer (KYC) and Anti Money Laundering (AML) procedures before in taking new customers.
Though most of the process is completed online, the applicants are required to send their proof of identity documents through post or in person during verification process.
The initial 2016 report, which focused only on the UK, revealed that the banks were struggling to on-board consumers due to lengthy paper processes and lack of digital identity.
Nearly 40% of these prospective customers, being frustrated, were found to terminate the process in the last step.
The new research stated that nearly 52% of the respondents accepted to abandon the application process, which rises to 56% in the UK.
It also found that 72% of the surveyed people want their banks to provide a completely digital on-boarding system.
Under the digital process, the customers are less likely to abandon the process thereby helping the banks to increase their revenue.
Furthermore, the survey stated that 52% of consumers intend to use additional services from a bank which will allow them to get on-board without a paper-based identity process.
Signicat CEO Gunnar Nordseth said: “The research uncovered some fascinating consumer behaviour around digital identities. It shows that customers that have verified and trusted digital identities are more likely to sign up for more financial products.”
The research surveyed 4,000 consumers across the UK, Germany, The Netherlands and Sweden.