Adapting to a Digital Self-Service Model
Credit union members are increasingly demanding more online interaction from their institutions. The request is forcing credit unions to adjust websites and self-service portals to accommodate members.
Initially, many institutions felt that only a small subset of their member base would actually use these portals, but the population of actual users is increasing rapidly. According to the American Bankers Association, in 2007 only 13% of bank customers age 55 and older said they preferred online banking over other channels. By August 2011, that percentage had risen to 56%. Consumers of all ages are going online and utilizing services like online bill pay, e-statements and even online account opening.
While it is important for credit unions to acquiesce to members, they need to be careful about the quality of information they collect online. When tellers enter member information in a branch, they have typically been trained on the proper way to enter member details and can verify data by checking government-issued identification. Unfortunately, the information entered online by the member themselves is often the dirtiest in a database.
The No. 1 one cause for data inaccuracies is human error, according to a recent Experian QAS study. Users mistype information, enter details in the wrong fields, or leave information off all together. Misinformation can create problems with efficiency, compliance and member satisfaction.
There are several techniques credit unions can utilize to ensure the accuracy of member information entered online.
Implement real-time verification technology. Credit unions need to implement online contact data verification that ensures the accuracy of information as it is being entered by the member. These tools should be interactive and prompt the user for missing information. For example, if a member leaves off an apartment number, the software can prompt the user to select an apartment number within that building.
There are a few considerations to take into account when selecting a technology. First, the software should work across multiple channels, meaning the online verification can also work in the branch and call center. This limits the number of implementations and ensures data accuracy across the institution. In addition, tools should take into account differences in mobile technology. Members no longer just access the Internet through standard computers. Credit unions should be forward-thinking and consider this rapidly expanding channel. Finally, verification software should not impede the user experience. If software takes too long to load or provides the user with too many prompts, the affect of the overall online experience could be negatively. Make sure the software ensures the accuracy of information without delaying the transaction.
Clean all information through a nightly batch processing. If credit unions do not want to put verification online, then information should be run through software tools for cleaning each night. These tools can verify contact information before it is entered into a central database and correct a good portion of errors. While this service is certainly better than no verification, it is important to remember the two draw-backs to this technique when compared to real-time cleansing. First, if members are missing information or put data into the wrong field, it can be difficult to correct in a batch setting. Second, cleaning each night could slow down operational processes and delay the member receiving services. It is important for credit unions to weigh these risks before implementing this type of verification.
Automate compliance processes. Credit unions need to automate compliance processes online. There are plenty of software tools that can help institutions search against regulatory lists or identify red flags. Credit unions need to put software online to search each record in real time, or cleanse them in the batch mode each night. With the volume of online transactions, it is difficult to manually check these compliance lists. In addition, because of that volume, this exposes institutions to greater risk since manually checking records is prone to human error. Software tools automate this process so credit unions can allow their members to do more through online portals.
It is important to consider several factors when selecting a solution, such as multicultural or fuzzy name matching. Individuals may try to disguise their real identity or members entering information may simply misspell a name.
Online banking has become more prevalent as members have demanded interaction with credit unions through this channel. While it can be challenging to balance online activities with compliance regulations and data quality, credit unions need to figure out a way to ensure that these standards stay high while improving the online experience. Without the growth of online channels, credit unions will be unable to stay competitive in the digital world.
Luckily, there are a multitude of tools available to help ensure online data quality. These solutions will ensure the accuracy of information entered online. This improves efficiency and the member experience while giving credit unions confidence in this expanding channel.
Thomas Schutz is senior vice president, general manager at Experian QAS.
CONTACT 617-385-6700 or thomas.schutz@ qas.com