The materials available in this article are for informational purposes only and not for the purpose of providing legal advice. You should contact your own advisors with questions regarding the digital account opening content herein. The opinions expressed in this article are the opinions of the individual authors and may not reflect the opinions of MeridianLink, Inc.
Every abandoned application is a lost deposit. Fintechs are coming out ahead by making the digital account opening process effortless, and it’s time to fight back.
In 2023, McKinsey & Company projected that fintech industry revenues would grow nearly three times faster than those within the traditional banking sector between 2022 and 2028. Fast-forward to 2025, where Cornerstone Advisors reported 64% of bank and credit union executives view big fintech companies as a major threat to their institutions’ growth, and it appears that McKinsey’s predictions weren’t too far off from reality.
But why are fintechs like neobanks such a threat to traditional institutions, anyway?
The answer lies in the experiences these financial newcomers offer. And in this case, we’re talking specifically about seamless, fast, and user-friendly digital account opening experiences that make it easy for your accountholders to move their money.
The Experiential Disconnect: Where Traditional Banks & Credit Unions Are Losing Applicants
Today’s consumers continually prioritize three key demands: security, customer service, and mobile and online access to accounts.
Financial institutions are aware of these expectations, too. The Cornerstone Advisors report reveals that more credit unions and banks plan to increase their institutions’ technology spending in 2025 than in 2024, citing several reasons in line with consumers’ demands: lacking integration between systems, legacy system constraints, insufficient automation, and inadequate data and operational metrics.
One could even make the case that these reasons are, to a degree, interrelated. With legacy systems still reigning supreme across traditional institutions, outdated infrastructure is limiting digital progress. Oftentimes, this technology struggles to integrate with core banking systems, resulting in data silos that limit how much accountholder information you’re seeing. Without access to the full breadth of your account holders’ available data, you increase the risk of inconsistent experiences based on incomplete profiles.
Incomplete data access doesn’t just limit engagement opportunities from a cross-selling perspective, either. Without smooth integration between banking channels—mobile, tablet, online, branch, call center, and kiosk—you run the risk of inefficient, fractured application processes. That means redundant manual data entry, higher error rates, and longer processing times—all culminating in the heightened risk of potential new accounts (and, as a result, new deposits) dropping off.
Consumers don’t want to enter and reenter the same information multiple times, nor do they want to move between platforms to complete different parts of the application process. These small issues lead to one big problem: cumbersome and lengthy experiences that drive potential (and existing) accountholders away from your institution and into the arms of competing digital newcomers who have the technology chops to meet the moment.
Imagine the revenue lost to unfinished, abandoned applications, the resources spent on processing those applications, and the impact on consumer trust, retention, and repeat business. It can all feel pretty bleak. Luckily, feelings are not all based in facts—and the fact is that with a few adjustments, your institution can begin improving its digital account opening processes, boosting deposit growth, and deepening consumer relationships.
The Fix: Create an Engaging Application Experience
An uptick in abandoned applications doesn’t necessarily indicate a problem with attracting consumers. In these cases, it’s more likely an issue of keeping them engaged. So, how do you maintain engagement and encourage those initial clicks to blossom into long-term financial relationships?
The best place to start is by examining your current system.
Audit your existing digital account opening process and note any friction points causing drop-offs, as well as areas where proactive adjustments could be made. After all, the banking landscape is constantly evolving, and any digital account opening system or LOS worth adopting in 2025 will need to be flexible enough to evolve alongside it.
Next, begin optimizing.
This is your chance to make doing business with your institution easy and efficient. You’ve already done the leg work, so start with the pain points you already identified and work from there! For example, maybe there are certain automation features you could be using to reduce redundant data entry or manual tasks, or perhaps there are third-party integrations that could help create a more seamless experience. Don’t forget to consider fraud mitigation and security in your adjustments, too.
One major area where you can make significant gains is in your mobile experiences.
While 90% of financial institutions offer web-based loan applications, only 65% offer mobile application experiences. Considering that mobile channels are the most widely used methods through which consumers manage their accounts, focusing on creating and/or improving mobile experiences can go a long way in boosting engagement and loyalty.
Similarly, creating a seamless, consistent digital account opening process across all channels, from mobile to in-branch, can also enhance the consumer experience and increase the likelihood of applications making it over the finish line. This way, whether a consumer prefers to breeze through an application from the comfort of their couch or come to a branch to ask questions person-to-person, they can trust that they’ll have predictable, smooth experiences aligned with their needs.
A few key features and capabilities that can further assist in providing these experiences include:
- Application Pre-Fill: Pulls existing accountholder information from the core into the required fields, saving time and reducing redundant data entry.
- Save & Resume: Allows consumers to save in-progress applications to complete later. After all, sometimes life happens, and the ability to be flexible can make all the difference.
- Electronic Documentation: Speeds up the verification process by gathering all necessary documentation electronically.
- Advanced ID Verification & Fraud Protection: Maintains a swift, secure experience and can help proactively reduce fraudulent applications.
- Quick, Easy Funding Options: Keeps qualified applicants moving forward due to convenient experiences that help more customers receive their funding faster.
- Segmentation & Personalization: No two accountholders are exactly alike. Being able to differentiate between consumer segments can help you better deliver the tailored service necessary to grow. For example, you may want to identify brand-new accountholders to receive a special introductory offer separate from your existing accountholders. A system that supports segmentation and personalization can enhance your outreach, making cross-sell opportunities more effective and driving higher engagement and revenue.
Your Next Step: Turn More Clicks into Accounts
MeridianLink® One harnesses the power of your data with robust automation and customizable workflows to create a seamless, efficient account-opening experience. With an open API, direct integration with most major core systems, and a vast network of compatible third-party solutions, this platform guarantees the flexibility, speed, and security needed for a smooth journey from application to funding.
Explore how MeridianLink® can help you grow your deposits with a digital account opening process that’s smooth and simple.
