A new Javelin Strategy & Research report, which included a “secret shopper” look at several credit unions, reveals there may be flawed online account opening processes at many U.S. financial institutions, the research firm said.
According to the report, “Faulty Process Hobbles FIs in the Battle for Customer Acquisition, Profitability and Retention,” just a little more than half of online checking account applicants succeed at completing the process.
The Pleasanton, Calif.-based firm said based on data it collected from more than 5,000 consumers in March and a “secret shopper” survey with 15 banks and credit unions, there is “a raft of frustrations that stem from limited application menus, unfriendly user interfaces, Web glitches, human intervention in a supposedly automated process and other shortcomings.”
In its “secret shopper” investigation, Javelin targeted 12 banks, including the 10 largest banks, and three credit unions: $45.5 billion Navy Federal Credit Union of Vienna, Va., Phoenix-based, $2.8 billion Desert Schools Federal Credit Union and $794.2 million Workers' Credit Union in Fitchburg, Mass.
Javelin assessed the types of accounts offered by the financial institutions for online applications, using website research and calls to customer service representatives when necessary, the firm said.
The firm reported unsuccessful online checking account applicants are either rejected, abandon the process or are forced to visit a branch, and failure and abandonment rates are “alarmingly high” for applicants who are new to a financial institution or less tech-savvy.
“Online account opening plays an important role because it can shape the first impression that consumers develop when they try to establish or deepen an online relationship with a financial institution,” Javelin said. “Javelin data shows, however, that barely more than half of online applicants for a basic checking account succeed in opening and funding the account.”
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Natasha Chilingerian
Natasha Chilingerian has been immersed in the credit union industry for over a decade. She first joined CU Times in 2011 as a freelance writer, and following a two-year hiatus from 2013-2015, during which time she served as a communications specialist for Xceed Financial Credit Union (now Kinecta Federal Credit Union), she re-joined the CU Times team full-time as managing editor. She was promoted to executive editor in 2019. In the earlier days of her career, Chilingerian focused on news and lifestyle journalism, serving as a writer and editor for numerous regional publications in Oregon, Louisiana, South Carolina and the San Francisco Bay Area. In addition, she holds experience in marketing copywriting for companies in the finance and technology space. At CU Times, she covers People and Community news, cybersecurity, fintech partnerships, marketing, workplace culture, leadership, DEI, branch strategies, digital banking and more. She currently works remotely and splits her time between Southern California and Portland, Ore.
