The goal is to confirm that they are who they say they are, not just an alias. It’s a key component in fighting identity theft, money laundering, and fraud.
Most fintech apps and financial institutions won’t allow users to make transactions unless they pass KYC checks. That’s because AML regulations and banking laws often require firms to do so for compliance.
Before the Wealthfront app can suggest an investment plan for you, it needs relevant information like your annual income, goals, and even your age. This allows the algorithm to offer a safe recommendation based on your ideal risk tolerance.
Lastly, your onboarding should help guide people to use your app. Remember that fintech exists to make financial services much more accessible.
Part of that is simplifying these processes to everyday users.
There are many approaches to this, depending on the nature of your fintech app. A benefits-oriented onboarding process, for example, puts the main upsides of using the app front and center.
Interestingly, fintech has higher retention averages than most apps, according to the recent Global App Trends Report. In general, 12% of fintech app users returned after a month of usage, compared to just 8% in other app categories.
While that’s beneficial for you as you try to make a name for yourself in that niche, you should also be aware of the flip side of this statistic: it means that many fintech apps are really good at their retention and onboarding strategies.
So if you want a chance, you should up your game as well.
But more than just keeping your numbers up, you should invest in proper onboarding for the sake of your users. That’s because it’s vital for a safe experience.
Processes like KYC are not only for compliance but also for keeping your users safe from fraud.
On top of that, onboarding allows them to set up biometrics, two-factor authentication, security questions, and other security protocols to help protect their data.
Be careful, however. There’s also such a thing as too much onboarding.
If the process is too long, it can bore users and lead them to drop out entirely. At best, an extended process can add unnecessary expense to your app development.
The key is to minimize the time it takes for the user to learn your app.
But the bottom line is this: the most important reason to have a proper onboarding process is to gain your user’s trust. This is perhaps the most important factor in the success of any fintech app.
We’ll discuss why in the next section.
Establish trust right away
Onboarding with your fintech app is just like dating, according to the folks at Invision. When users first launch your app, you only have less than a minute to get them hooked in.
That means not only engaging them but gaining their trust as well.
Another example is the Chase app. The recent iOS update requires apps to expressly ask users permission to track them or use their location. It’s making people nervous, but Chase explains the reason behind it to allay those fears.
Of course, the best way is to demonstrate just how secure your users’ data is within your app.
That starts with basic authentication and authorization protocols like biometrics and two-factor authentication. You can also mention how you use technologies like data encryption to safeguard sensitive information.
On top of this, you can also include added precautions to boost your app’s security.
A good example is an automatic logout feature that kicks in after a short period of inactivity.
While it can be annoying to have to re-login every time, the added security it brings will be appreciated by your users.
Another is the liberal use of notifications, which alerts the user on key activities like receiving payment or getting close to overdraft. While constant pop-ups can be annoying in other apps, they’re highly appreciated and even necessary in fintech.
To sum up, don’t be afraid of adding frictionto your app onboarding to make your app more secure.
For example, setting up 2FA or requiring authentication for every transaction might be an added step. However, in this case, it’s a necessary one for the user’s welfare.
Don’t force information collection
As fintech app developers, we know the importance of gathering data. However, we sometimes tend to go overboard with it. And this can be a source of annoyance for your users.
The key is only to ask for information that’s needed at the moment. And (we really want to emphasize this point) always look at data collection from the user’s point of view.
If the time they give in filling out a questionnaire isn’t worth the benefit they’ll be getting, don’t do it.
A key tactic for this is to include a “Skip” button so users can opt out of certain forms. It’s also worthwhile to give them alternatives instead of manually entering their info in a lengthy form.
The Fisdom app does this very well for its KYC process, which spans five ridiculous pages.
However, they found out that the app can derive key details from a person’s permanent account number or PAN (which every Indian citizen has). Doing this cut the process by half.
Nevertheless, you need to be transparent when doing this—always let your users know what you’ll be getting from them.
A 2021 study by The Clearing House revealed that 75% of responders were unaware that their apps were gathering data without their knowledge, even when the app was turned off or deleted. That’s never good for trust-building.
Therefore, giving your users an alternative way to provide information is useful. It also
Make onboarding seamless
The key to making onboarding work is to make it easy, effortless, and engaging for your users. That gives you a higher chance that users will go through it.
This formula from the UX Collective perfectly encapsulates the gist of what we’ve been talking about so far in this article:
With that said, it’s useful to provide a way for users to see the progress of their onboarding. Doing so sets expectations of how long the process takes, plus it gives them a psychological boost to complete the process.
While not a fintech app, Linkedin illustrates this process nicely with their Profile Strength metric, encouraging you to finish your profile as part of onboarding.
As a bonus, it also shows the benefits of hitting each milestone:
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