Know Your Customer UX: the good, the bad and the ugly

This month we’re exploring Know Your Customer (KYC) solutions within banking. But first things first, what does KYC actually mean? KYC is the process for verifying a potential customer’s identity when setting up an account using relevant information and documentation. Having optimum KYC capabilities allows banks to build a more complete understanding of customers and make more informed decisions in a bid to limit risk and security issues.

KYC is vital for banks, and the uptick in digital banking, products and services means a simple and efficient customer onboarding experience is essential. Yes, banks must limit their risk and exposure, but customers don’t want to waste time during the sign-up process. KYC needs to be both rigorous for the banks and efficient for the user. So, with that in mind, let’s explore which KYC provider is good, which is bad and lastly, which is ugly.

UX criteria

Before we jump in, let’s first recap: what do ‘the good, the bad and the ugly’ mean?

• The good: I’d tell my friends all about it and really advocate for it
• The bad: It’s just OK, but has the potential to be so much better
• The ugly: It works, but the experience is poor and it’s a turn-off to continue engaging or revisit

Of course, we need to bring some objectivity to our assessments, so what criteria are we using this month?

• Speed & security
• Personalisation
• Aesthetics – i.e. is it visually appealing?

Good – Sumsub

Sumsub are our ‘kings’ of what good looks like. With clients such as Virgin Money, TransferGo and Coinsmart, Sumsub provides one of the most efficient and secure experiences, making them a leading choice for banking platforms.

Speed & security: By incorporating AI into their consumer digital identity checks, Sumsub can cross-reference their user from multiple data sources whilst examining their identity via biometric testing. And this is all done within 34 seconds – faster than any competitor in the market – making a huge difference to users. Not only does this reduce onboarding time, AI also ensures that all security measures are met, instantly flagging suspicious applications to the banking platform. In turn, this improves the experience of bank personnel who manage this process and are accountable for who gets a bank account.

Personalisation: In addition to a fast and secure experience, Sumsub allow their banking customers to pre-define the questions asked in their individual process (rather than selling them a package of questions and associated risk logic). This allows their customers to tailor their onboarding journey to be both secure and user-centric, allowing for a speedier onboarding time. In addition to security and speed, this bespoke user journey allows clients to flag individuals that are considered to be located or operating within risky jurisdictions or industries.

Aesthetics: By having a completely editable user interface, customers can edit the platforms’ aesthetics so that it fits to their brand guidelines, ensuring a seamless brand experience for their users. In addition, the bank-facing interface operated by onboarding managers or KYC teams is host to a simplistic, yet intuitive set of aesthetics that don’t just look superb but also increase efficiency. If you’ve been re-directed to a 3^rd party solution as part of a sign-up process, it’s often obvious, leaving some feeling less secure when this occurs.

Bad – Fully Verified

While Fully Verified offers an integrated digital KYC service that is employed by Halo Financial, their process still follows a hybrid model which combines both AI and an “old school” video call with a KYC expert.

Speed & security: As seen with Sumsub, AI is effective in reducing onboarding times. Yet, this AI feature is not experienced in the same way. Fully Verified’s use of AI is limited to the video call with the KYC specialist who will interpret the AI results in real time, cross examining with the user on the call. So, the benefits of using AI are restricted to just data comparison, leading to the reliance on human interpretation and decision-making. The result in a not-so-fast, yet secure experience. However, dependent on your use case or requirement,  this could actually be great for your business, especially if you’re onboarding High Net Worths (HNWs) or Politically Exposed Persons (PEPs), but perhaps not for a retail client.

Personalisation: Fully Verified, unlike Sumsub, doesn’t offer a custom question database with personalised risk-scoring. Instead, they offer a package option that can include sanction lists and PEP checks. While the package deal can be convenient, it fails to offer a solution that is personal to a potential customer’s onboarding journey. A solution that is not user- or business-centric could therefore fail at providing an efficient and secure onboarding journey.

Aesthetics: Fully Verified’s aesthetics are slick, minimalist and intuitive to any user experiencing their onboarding process. However, this becomes irrelevant when the user has to join a video call with a KYC specialist. The poor visuals of the video call dwarf the previously experienced aesthetics – the results of autonomy and sophisticated design.

Ugly – IDnow

While Sumsub and Fully Verified use innovative methods to achieve speedy, yet secure onboarding experiences, IDnow employs techniques that require human interaction and human judgement. With arguably the slowest onboarding times within the market, users can spend up to an hour waiting for a KYC specialist to answer the phone and even longer to process their application.  

Speed & security: IDnow are yet to incorporate innovation to help with data-comparison, biometric verification, or fraud detection. Instead, they rely on a video call with a KYC expert. This lack of AI causes the KYC experts to be rigorous in their questioning which results in an inefficient Turn-Around-Time (TAT) and poor user experience.

Personalisation: Relying solely on humans to conduct your onboarding KYC results in a lack of personalised questions and associated risk-based logic. Without this personalisation, the onboarding journey could potentially irritate the client, which may lead to them abandoning the onboarding process. However, if you are a bank just starting to move into the digital era and have little capability, this type of service could make sense whilst you are maturing capabilities that allow for self-service journeys at a later stage.

Aesthetics: Poor TATs and an overly rigorous KYC process aside, IDnow are not making up for their absences with looks. IDnow, unlike the others, does not integrate their clients’ brands within their platform, resulting in a broken branding journey which can be confusing for any user. This separate journey certainly doesn’t contribute to a good experience. Considering the unbalanced process already in use by IDNow, flexibility around the customer journey could help their position in the market.

All in all…

Know Your Customer (KYC) is arguably the most important aspect of an onboarding process. A rigorous KYC process is important to protect your business and customers. But that rigour must be exercised with as little friction as possible, or you run the risk of customers abandoning the sign-up process. A good KYC experience is one with the perfect balance of both speed and security. Poor first impressions, arduous onboarding times and a reliance on human judgement are all major contributors to clients withdrawing from the onboarding process, the cost of which can be detrimental to any bank’s reputation and indeed growth of new customers.