Feb 22, 2021

Customer onboarding: All you need to know

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Customer onboarding: All you need to know

Customer onboarding, also known as client onboarding, is crucial for any company today. Registration and incorporation process of customers to the company or organization are essential within the acquisition process.

Defining, examining, and fine-tuning the process is a key necessity for the funnel and the company’s growth. Thus, understanding how the customer onboarding process should be carried out in such a way that it adjusts to the technical and regulatory necessary requirements while offering an adequate experience to users should be the priority of any business strategy.

Schedule an appointment here and access 508 million consumers thanks to the European standardization of customer onboarding.

Defining the concept: Customer onboarding / Client Onboarding

Customer Onboarding or Client Onboarding are the terms used to refer to the process of incorporating new consumers. That is, when a user goes from not being a client to being one officially.

It is the term used to define the first steps in the relationship between a user and a company, organization or platform so that they become part of it as a registered and verified customer.

Customer onboarding can take place in a digitized and immediate way both on-site in a business location of the company or organization and remotely through the channels available to users on the Internet.

The digitization of client onboarding has been taken both offline and online thanks to versatile and comprehensive identity verification solutions, which adjust the technical and regulatory needs to the environment where the acquisition process is carried out.

Learn about the Know Your Customer (KYC) process in this article, closely linked to customer and client onboarding.

Technical aspects, security and compliance of client onboarding

Customer onboarding must be carried out in accordance with a series of appropriate and specific standards and norms so that it takes place in a safe framework and holds all the necessary support and guarantees.

Thus, it is important to understand that offline and online client onboarding differ in terms of form and substance, presenting different risks for each of the environments and which must be avoided by establishing a safe procedure that includes the necessary controls and checks.

Therefore, it is imperative to be robust at both technical and regulatory level without forgetting about user experience and agility within the customer onboarding process. Likewise, it is important to understand that you must adapt to the sector in question; hence the need to have a digital expert and compliance partner suitable for the process to be optimal.

Client onboarding in the financial sector

Needs of the financial, banking, insurance, investment and related sectors make client onboarding more delicate and must be carried out with attention to detail, in accordance with the specific regulations and standards of these sectors.

In these areas, all needs must meet AML (Anti-Money Laundering) standards as well as complying with the eKYC proper requirements to avoid identity fraud and mitigate any type of possible risk.

Regulatory Framework for customer onboarding

The regulatory framework that defines customer onboarding compliance needs revolves around three main standards:

  • AML5: The fifth directive against money laundering sets the AML controls that must be established during the customer onboarding process. It is the base standard which states refer to around the world to regulate this process.
  • eIDAS: Acronym for “electronic IDentification, Authentication and trust Services”, it is the system by which the guidelines for the recognition of electronic identities are established. Thanks to eIDAS, companies can operate safely and confidently on the internet and carry out customer onboarding in a totally remote way.
  • SCA: Strong customer authentication sets the standards for online transactions and operations to be carried out under a framework of guarantees, security and legitimacy.

Download here for free our complete guide on AML5 and eIDAS for the client onboarding process.

How the customer onboarding process works

For this client onboarding process to be carried out properly and so that a company can register a user as a customer with guarantees and complying with the relevant technical and regulatory obligations, the identity verification process within the acquisition time must be done through streaming video identification as follows:

  1. The customer registers in the company’s acquisition platform.
  2. A video is started and customers are asked to show their identity document on both sides.
  3. Then, they show their face and smile at the camera.
  4. During the client onboarding process, a series of technical and security checks are carried out thanks to artificial intelligence and machine learning tools.
  5. If necessary, for greater security and robustness, a human agent can verify the video later.
  6. The client has been successfully registered and customer onboarding process is finished.

Request here a demo of VideoID, the eID technology that makes customer onboarding possible

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