RFi Group Insight - Australia: Can Digital Help to Solve Key Pain Points in the On boarding Process for Business Banking Customers

For business banking customers, getting the onboarding process right is key to driving satisfaction and creating profitable business banking relationships. Satisfaction with the onboarding process is highly correlated with overall satisfaction with main bank, particularly in the initial years of the banking relationship. However, only one in two SMEs indicate high levels of satisfaction with their main business bank (scored 8-10/10). Clearly, there is more work to do to create a better onboarding process for SMEs.

"SATISFACTION WITH THE ONBOARDING PROCESS IS HIGHLY CORRELATED WITH OVERALL SATISFACTION WITH MAIN BANK. HOWEVER, JUST ONE IN TWO SMES INDICATE HIGH LEVELS OF SATISFACTION WITH THEIR MAIN BUSINESS BANK."

When it comes to establishing the initial business banking relationship, face-to-face application channels appear difficult to compete with. According to RFi Group data, the majority of businesses took out their initial product via a branch with their main business bank. Meanwhile, just one in five applied for this product online. While this has shifted over time - with businesses established in the last 3 years more likely than average to have applied for this product via a digital channel - branch remains the most common application channel for SMEs.

The complexity involved in initiating a business banking relationship is one reason for this preference for a face-to-face interaction. For many businesses the ability to ask questions of bank staff during the application process is an important aspect of the application process. Naturally the bank branch can fulfil this engagement to a greater extent than digital. The branch is also considered to be an ‘easier’ and ‘simpler’ channel for starting a business banking relationship for a number of SMEs. Creating a quick and simple application experience is the primary driver of overall satisfaction with the onboarding experience. However, utilising those same features of speed and simplicity are where the opportunity for digital lies.

"Despite the role of the branch at the final application stage - digital play an introductory and important role in the customer journey for business banking relationships...Some products also present a greater opportunity to shift to digital application channels."

Despite the role of the branch at the final application stage - digital play an introductory and important role in the customer journey for business banking relationships. Like consumers, businesses, are utilising digital channels at the very first stage of applying for a business banking product. However, it appears that complexity and the need to ask questions of a real person are shifting businesses to the bank branch towards later stages of the application. To shift higher proportions of businesses past the digital research to actual digital enquiry and application will require ensuring that businesses can access all the information they need easily; that this information is easy to interpret and understand; as well as the addition of features like live chat can help to answer questions within digital channels.

Some products also present a greater opportunity to shift to digital application channels. RFi Group data indicates that businesses are most likely to apply for a business credit card online. This is likely a result of high levels of understanding of how credit cards work; and fewer questions that need to be answered by a real person during the application process. Conversely the initial but more complex products, e.g., business loans and everyday business banking accounts taken out with a bank are likely to take longer to shift to digital.

"RFi Group data indicates that businesses are most likely to apply for a business credit card online, likely as a result of high levels of understanding of how credit cards work."

While digital may not (yet) be ready to replace the branch as an application channel there are real opportunities for digital. Supporting the application process via digital channels to a greater extent and helping funnel potential customers performing research online through to application will increase this shift.

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