Economic pressures, regulatory oversight, and shifting customer expectations have permanently changed the financial services industry. Banks, credit unions, mortgage lenders, and retail finance companies are now challenged with balancing cost-reduction against new investments in innovation to better capture, service, and support the modern customer. In the midst of this transformation, financial services providers are more concerned than ever with meeting compliance requirements dictated by Gramm-Leach-Bliley, the Consumer Protection Act, Dodd-Frank, and other laws.
[State Street's EVP and CIO Chris Perretta outlines the challenges facing financial institutions trying to transform into digital, data-driven enterprises.]
Amidst these challenges, the trend towards digital processing is clear: Financial organizations of all sizes are moving their customer transactions online and using e-signatures to ensure a seamless experience. There are major security regulations and obstacles that must be taken into consideration when moving transactions to an online environment. While the industry has seen security breaches occur over the past few years -- increasing the hesitancy for banks to make the move to a digital platform -- these series of events actually put an extra emphasis on strengthening online security.
Not to mention, non-compliant paperwork is a huge pain point for banks and something that is almost always a challenge. The high number of errors in manual, paper-based banking processes collectively costs banks hundreds of millions of dollars correcting as much as 30% of documents across all lines of business. By moving to online banking, document errors are reduced significantly, which also reduces downstream legal and compliance risks, contributing to an overall improved customer and staff experience.
Offering a seamless customer experience
Despite the security concerns, the growing demand to execute business and financial transactions via the Internet and mobile devices has led banks to recognize that, in order to improve and maintain customer experience, they must provide customers with an omnichannel experience, allowing anytime, anywhere transacting.
As a result, banks are using e-signatures to create a completely electronic transaction model that is compliant, secure, and enforceable. In fact, e-signature adoption has grown 48% in the past 18 months, according to a recent report by Gartner. With online straight-through processing, banks gain the power to monitor the state of customer transactions to identify bottlenecks quickly, take action to keep transactions moving forward, and offer improved support to customers.
Mobile transactions are also becoming more prominent in the banking sector. A recent study from Novarica and a report from The Financial Brand explained that plenty of consumers are turning to mobile channels to set up new checking accounts. By providing users with the ability to bank anytime, anywhere, customers are happier and efficiency is improved.
Results after going digital
A top US bank that offers a comprehensive line of banking, brokerage, insurance, investment, mortgage, trust, and payment services to consumers, businesses, and institutions across more than 3,000 retail branches recently implemented an e-signature solution to streamline its operations. Since the implementation, the bank has eliminated more than 90% of exceptions and will therefore reduce future risks on the consumer and SMB loan portfolio by 50%.
The implementation also ensures that the bank will meet all security, regulatory, legal, and compliance requirements. The bank projects that its policy and regulatory exceptions in consumer loans will be reduced by more than 70% in small business loans. It also redeployed 95,000 hours of its staff’s time, which is expected to enable each branch to sell an additional two loans per year. Eliminating manual paper processing has reduced 80% of the bank’s loan-document-handling costs.
Additionally, RBC Royal Bank implemented e-signatures throughout its 8,000 national mobile and branch investment staff across Canada. Since implementation, e-signatures have helped RBC’s investment group save in excess of 100,000 personnel hours. Customer and staff adoption of the technology has practically doubled every month, helping to put an end to paper processing for this line of business. E-signatures have resulted in error-free transactions, removing the need to bring customers back into the office due to missing information, while saving two to three hours per week in sales administration tasks such as the scanning and filing of paper documents.
What to look for when choosing an e-signature provider
When looking for enterprise e-signatures, banks should look for several things in both a vendor and its solution. On the vendor side, banks benefit from working with a vendor with strong experience in banking and other highly regulated industries. It’s also important to review customer-sourced reviews for high customer satisfaction rates, especially from personnel at other banks and financial service organizations.
When considering an e-signature solution, banks should identify one with the following traits:
- It is easy-to-use and can be integrated using software development kits (SDK) and application programming interfaces (API)
- It has flexible deployment options (both on-premises and SaaS) with high customer and staff adoption rates stemming from seamless integration and white-labelling the e-signature solution
- It contains the strongest legal protection by offering both document and process evidence that is easily replayed and verified in one click, independent of the vendor
In choosing a vendor and solution that meets these needs, financial services organizations will be up and running quickly with e-signatures, allowing them to meet customer demands while streamlining processes and improving the customer experience. What’s most important is that the customer’s financial affairs are processed safely and securely, giving banks and financial services organizations the ability to offer peace of mind to customers looking for convenience without compromise.
Tommy Petrogiannis co-founded Silanis in 1992. As President and CEO, he is responsible for setting the company strategy and vision, building corporate culture and ensuring the entire team is working towards the corporate goal of delivering the "best possible customer ... View Full Bio