The use of video technology in the specialist banking market is allowing customers to set up current accounts in minutes and offers further potential use in SME banking.
Last week, Banco BNI Europa introduced a new online account opening feature through video conference.
The feature allows customers to sign their documents with a qualified digital certificate to open individual current accounts.
There could also be real potential for video technology to be adapted for other market segments, such as SME banking.
Specialist Banking approached Starling Bank to gain some insight into how video technology is being implemented in the challenger banking space.
While the bank doesn’t use video conferencing, it does require applicants to submit a short video – which they can record at any time – to enable them to open an account in a matter of minutes.
The bank then creates a queue of video submissions and processes them over time.
Starling Bank suggested that one issue with video conferencing for current account applications was that it required teams of customer service people to be available to take calls at times that were convenient to customers.
Another drawback pointed out by the bank was that if submitted videos were not clear, it may have to contact the customer to confirm certain data.
Anne Boden, chief executive at Starling Bank, said: “At Starling, our goal is to make the customer experience as simple, fast and efficient for the consumer as possible and not to replicate the in-branch experience.
“We are, after all, a digital bank and the real digital experience means trying to take the effort away from the customers and not to replicate legacy banking systems.”
Nancy Kalogeropoulou, UK country manager at Fidor Bank, said: “Video applications have both pros and cons.
“In terms of pros, this process means customers have an easy, efficient and hassle-free account-opening process.
“In the digital banking era we now live in, this is really crucial.
“However, such applications require a very good internet connection, which not every customer will have, and if they get halfway through an application and it fails, they are unlikely to return again.”
Richard Lowe, business unit lead – UK BFSI at SQS, added: “Video application processes will add an interesting dimension to verifying personal identity, particularly when used in conjunction with traditional data, such as names, addresses, dates of birth or implementing voice administration.”
However, he also stated that there were some pitfalls to the use of video application processes.
“We’ve seen individuals using fake IDs from people with similar features to apply for [driving] licences,” he said.
“The same applies for all kinds of biometric authentication.
“It will be crucial for banks to monitor the accounts of video applicants carefully for signs of unusual and unexpected behaviour which might signal fraudulent activity and ensure that the technology functions correctly by taking a quality-first approach.”
Given the use of video technology for retail banking current accounts, it’s only natural to question whether it can be extended to business accounts.
Fidor Bank already uses video technology to open business accounts for SMEs.
The company uses the IDnow video identification process for both its retail and corporate SME clients.
“Video applications do have the opportunity to make a large impact in the SME accounts market,” continued Richard.
“Small business owners tend to be very time pressured and interacting with an online representative can eliminate lengthy face-to-face meetings.”
Sabine Popp, head of marketing at CivilisedBank, said the company believed it could see benefits for SMEs in using video applications to open both business current and savings accounts.
“If a company had to put in a lot of details into their online application and fields can’t be prepopulated with Companies House data, video assistance would be beneficial to help them through the process,” she added.
“Equally, where the online application can’t be processed straight through, picking up a video chat would be a more direct and personal way to address problems.”
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