Chris Sibila
Chris Sibila Jan 27, 2020

Payments power, channeled for customer engagement

To sell or to engage?

Many financial institutions struggle with this question relative to customer onboarding. And we have an answer: Engagement wins.

According to Javelin Strategy & Research, financial institutions can boost the profitability of new checking account customers if onboarding successfully engages them.

That is: Fully engaged customers provide an estimated $212 more in annual profit than inactive customers. In fact, inactive customers represent a net loss to banks over the first three years. Plus, fully engaged customers own 2.7 times more financial accounts than the non-engaged.

In other words, if you onboard and activate to build engagement then that translates to more profit. But if that’s the case, why do financial institutions have such a hard time with this process?

Simply, it’s hard to do efficiently and effectively. You need a way “in” with your new customers: an active, automated process to drive engagement. Payment instruments make for a great place to start.

Payments reality check: It's not all about the check


It costs financial institutions a small fortune to open an account—between $300 and $750, according to a 2019 issue of Novantas Review. But up to 40 percent of these new accounts never go active, which negates your opportunity to recoup this initial investment.

A solid account activation process is a must—not only to recoup your acquisition spend but also to set up your financial institution for “primary” status and future profitability.

Indeed, a sizable gulf separates vigorously engaged accounts via activation messaging from the rest. New checking account customers who become familiar with engagement-building features during onboarding are 20 to 67 percent more likely to use six primary financial institution services each week: mobile banking, online bill pay, mobile alerts, debit cards, online banking and direct deposit.

With this disparity in mind, Javelin suggests turning account opening and onboarding into a “corporate mission” that will “encourage habitual interaction, build customers’ sense of financial control, and develop trust and loyalty that will position the financial institution for cross-selling later.”

We believe payments represents one of the most effective ways to accomplish this— specifically via checks and cards.

While many bankers don’t talk much about checks anymore, about 70 percent of consumers need them. In fact, a BAI article reports that “order checks” ranks among the top terms people search for on a financial institution’s website. Unfortunately, less than half of the customers who need checks get them from their financial institution, according to Harland Clarke’s proprietary research.

If you don’t try to capture check orders, you’ll miss out on an enormous engagement opportunity.

The same holds true with cards. Debit card activation represents a key indicator of full engagement. When you fail to issue and activate a card at account opening or immediately thereafter, an important engagement opportunity passes you by.

Activation flow: seamless, simple, strategic


Capturing these engagement opportunities requires a consistent, simple and seamless activation process for the new customer and financial institution—one that’s strategic for the account relationship and its future.

How can you ensure your new customers possess the payment instruments they need and leverage them to activate the new relationship? Here’s the three-part vision:

Seamless: The process should begin right after an account opening with a personalized digital follow-up. This outreach—to every new customer—would include links to an easy setup of mobile banking, online bill pay, payroll direct deposit, check ordering and more.

For in-branch openings, putting this activation process in place takes pressure off harried staff to accomplish these tasks with the customer. The process also provides an opportunity to establish personalized, non-sales-flavored back and forth with customers regardless of the channel they initially use to establish a relationship with the financial institution.

Simple: All set-up and ordering must be “Amazon easy.” For example, make check ordering quick—done in one click, if possible. Check designs and quantity choices should match your customer's lifestyle. Our research confirms that reasonable, “all-in” pricing should include free, trackable shipping.

Strategic: The delivery vehicle should engage consumers, too. Ship checks and cards in a personalized mailer that you design with engagement in mind and brand with your financial institution’s logo, colors, look and feel.

Take advantage of this sure-to-be-opened mailing with personalized messaging to create a new account "activation kit" experience. Include a QR code to facilitate downloading your mobile app and a bonus incentive check so the customer will try mobile deposit; also include a reminder of how to set up payroll direct deposit. Keep in mind that once you establish this interaction and trust, future personalized communication becomes a natural way to cross-sell based on your knowledge of specific customers’ needs.

Putting it all together: Immediacy equals imperative 

Timely onboarding and activation of new accounts will build a foundation that consists of highly engaged customers. Using payment methods as the way in leads to a better overall experience. Checks and cards delivered with personalized messaging increases activation and product usage while it decreases attrition. This leads to net account and balance growth—and every financial institution likes those kinds of results, right? Truly when engagement wins, it’s a win-win.


Chris Sibila is senior vice president of product management, payment services at Harland Clarke.


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