How have you seen digital onboarding change over the last five years?
Digital onboarding has undergone profound changes in the last five years. Neobanks and crypto financial service providers have led this change because they realized early on: Simple, transparent and cost-effective onboarding is the key to success. With efficient processes and scalability, they keep their operating costs low and thus provide their services at competitive prices.
Traditional banks are also facing this kind of pressure. This is why many of them have modernized or introduced new onboarding processes in their branches and self-service areas over the last three years. However, this change is not only taking place on a technical but also on a cultural level: the focus is now on the customers. Accordingly, processes must be simple and user-friendly.
Advances in computer vision technology have further enhanced this development. In non-regulated business areas, there are now fully automated, self-guided identification processes (AutoIdent) that further speed up and simplify the onboarding process. In regulated business areas, we are also experiencing a shift away from video identification towards auto-identification, which is then checked by people in the background if required by regulations. These technologies make digitalized onboarding processes even more efficient and secure.
What are the next big breakthroughs we can expect in the area of digital onboarding?
I expect the next big breakthroughs in digital onboarding to be in the areas of smart onboarding, convenience, individualization and the use of existing identities.
1. Smart onboarding
Onboarding will become intelligent in the future. The direct integration of various data sources, such as credit checks, commercial register extracts, address checks and KYC checks, are likely to further change onboarding processes and, most importantly, make them smarter. In the future, decisions can be made in real time during onboarding based on this data so that customers can purchase products immediately and, if desired, have them financed straight away. In this way, interested individuals will immediately receive binding offers, which they can then contract straight away.
This type of smart onboarding also offers various advantages for companies. On the one hand, it opens up new sources of income, while on the other, risks can be identified at an early stage and addressed accordingly as soon as they are initiated. This not only saves costs, but also optimizes subsequent processes. The development of a company's own customer portfolio can thus be actively managed.
2. Convenience
Smart onboarding also increases convenience for end users. They can obtain additional services such as insurance or financing directly at the point of sale. Thanks to the combination of external data sources and the consent of individuals to use their bank or insurance data, redundant form entries and document uploads can be avoided. This not only improves the user experience, but also the accuracy of the data collected.
3. Individualization and alternative identification methods
Digital onboarding will continue to gain flexibility in the future. This will enable additional customization options within the process, allowing it to be adapted even better to the specific needs of users. For example: If a person has difficulties with a certain identification method, an alternative is offered immediately. This will increase the conversion rate of digital onboarding and further improve its acceptance.
4. Use of existing identities
Identity becomes digital. The integration of existing digital identities, such as those currently stored by trust service providers or those that will be provided by the government E-ID in the future, will also be a major step forward for digital onboarding. Onboarding processes will become even simpler and more secure, and identity verification will be further accelerated. This development is a win-win situation for both customers and companies.
To sum up, digital onboarding is becoming increasingly smarter, more secure and more user-friendly. Companies that actively embrace and integrate these developments will be able to increase their value chain, boost conversion rates and improve the scalability of their internal processes.
How can artificial intelligence help to make the digital onboarding process more efficient and secure?
Artificial intelligence (AI) already significantly outperforms humans in certain areas. For example, machines are massively better than humans at biometric face matching. This will probably also play an increasing role in physical identification in the future and improve security in this area.
But AI is a tricky thing: it is both a blessing and a curse, as hacker groups are also using AI to carry out more and more sophisticated and scalable attack scenarios. The only way to win here is to use AI yourself to increase security. After all, AI is making continuous progress, for example in image recognition, such as holographic cinematic elements, or in the detection of deep fakes.
AI also helps to recognize unusual access patterns (anomalies) and fraud patterns. In such cases, further security steps must be activated immediately. In this way, AI will not only make the onboarding process more efficient, but also significantly increase its security.
When will the E-ID arrive and how will it affect current digital onboarding solutions?
I would like to ask the audience for this question. In the end, the public - i.e. all of us - will decide how quickly we will obtain and use our own E-ID. Officially, the E-ID will not be available until early 2026 at the earliest. Personally, I assume that this schedule cannot be met entirely and that it is more likely to arrive at the end of 2026 or even 2027.
However, the introduction is only half the battle. The speed at which the e-ID spreads among the population will be crucial to its success. The federal government must create incentives to ensure that the e-ID is accepted and used quickly. If this is successful, the e-ID will make digital onboarding considerably easier, as a widely used, standardized and trustworthy proof of identity will then be available. Data required for the onboarding process can also be obtained via the e-ID, further simplifying processes.
Even if it is not yet possible to predict when the critical mass of e-IDs will be issued, I still recommend that companies address this issue now and invest in forward-looking digital onboarding solutions. After all, in order to remain competitive, the e-ID of tomorrow must already have a strong position in today's product strategies and digital onboarding solutions.
