AI set to reduce bank digital onboarding time by 30%, research finds

Joy Agwunobi

According to a recent report by Juniper Research, the use of AI in digital onboarding checks for banks is expected to significantly reduce the time spent on these checks. The report states that AI will reduce the average time spent on digital onboarding checks from over 11 minutes in 2023 to under 8 minutes in 2028, a reduction of approximately 30 per cent. Juniper believes these efficiency gains will encourage more banks to adopt AI for digital onboarding, as it will enable them to save time and money while improving the customer experience.

The report predicts that developing regions will see the highest growth in the adoption of AI for identity verification in the coming years. The reason for this is the increasing use of smartphones in these regions, which makes it easier to digitally onboard customers. This trend is expected to continue as more banks in developing regions look to improve their processes and provide a better customer experience. Developing regions often have a large unbanked population, so the adoption of AI for identity verification could have a significant impact on financial inclusion and access to banking services.

The report notes that as AI technology improves in accuracy, fewer identity checks will need to be reviewed by human agents, and the need for customers to retake their ID photos will decrease. This will lead to a faster, smoother, and more efficient onboarding experience. The report predicts that this will encourage more banks to adopt AI in their processes, as it not only provides a better experience for customers but also reduces costs and helps to combat fraud.

The report forecasts that the increased adoption of digital verification in banking, particularly in mobile banking, will drive revenue growth for digital onboarding solutions. Even though the efficiency of AI will reduce the cost of each individual digital identity verification check, the growing volume of checks, particularly in developing regions, will offset this cost reduction. The report also predicts that total spending for banks on digital onboarding solutions will increase from $7.4 billion in 2023 to $9.9 billion in 2028, representing a 34 per cent increase.

Michael Greenwood, the report’s author explained that “Growth will be particularly strong in developing markets, where rising smartphone penetration is making mobile banking more readily available; driving growth in digital onboarding. To capitalise on this, verification vendors must develop onboarding processes that emphasise checks other than credit scores, such as mobile operator history, in order to maximise viability in emerging regions.”

Nigerian banks are currently using AI in a variety of ways to improve the customer experience. These include machine learning algorithms, customer behavior analysis, and data analysis to create more personalized experiences. AI is also being used for customer service through chatbots, which have become a key differentiator for banks in Nigeria. All of these efforts are aimed at providing a better experience for customers and giving Nigerian banks a competitive edge.

Chatbots are automated programs that use artificial intelligence to engage with customers in a way that mimics human interaction. They are relatively inexpensive to implement and can provide a wide range of services, including customer support and financial transactions.

Nigerian banks are taking advantage of this technology, with several of them developing their own chatbots. Zenith Bank has Ziva, Fidelity Bank has Ivy, First City Monument Bank has Temi, UBA Group has Leo, Access Bank has Tamada, Heritage Bank has Octopus, and Keystone Bank has Oxygen.