European financial institutions lose over €5bn every year on poor customer onboarding

Poor onboarding practices cost European financial institutions over €5.7bn every year, according to new research.

P.A.ID Strategies conducted the research on behalf of digital identity company Signicat, demonstrating that poor customer onboarding and abandonment prove costly for companies.

The report showed that 63% of consumers in Europe abandoned financial applications in the past year, representing an increase of 23 percentage points compared to 2019.

“Customer acquisition is a hot button issue right now – some new banks are especially keen to reference their figures to prove to the market how well they are doing,” said John Devlin, founder of P.A.ID Strategies.

“But much of that spend is wasted. Consumers will simply abandon processes that they see as too challenging, problematic or intrusive. Without dealing with this last hurdle in customer acquisition, the financial services market is squandering billions every year.”

Asger Hattel, CEO of Signicat, added, “As a result of the pandemic, onboarding customers digitally, securely and seamlessly is vital for organizations to continue doing business. Billions are spent on clever marketing and compelling products every year by the smartest people in the business – and it works, with millions of potential customers starting applications for financial products. Yet it is vital that the industry takes note of where they can improve the onboarding experience, in order to turn these applicants into actual customers.”

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