Filipino consumers do not want inefficient digital procedures when opening a personal bank account via mobile app or website, a study by Global analytics software leader FICO showed.

According to the study, Filipinos opening a new financial account place more emphasis on good fraud protection and ease of use.

“The growing ubiquity of digital banking services means that Filipinos now increasingly expect a frictionless banking experience, especially when opening accounts,” said Aashish Sharma, APAC segment leader for risk lifecycle and decision management at FICO. “Our research reveals that streamlining these processes will be key in financial institutions retaining customers and enhancing satisfaction.”

The survey for the study was conducted in November 2023 by an independent research company adhering to research industry standards, and covered 1,001 Filipino adults.

The study showed that three in five Filipinos (59%) expect to answer 10 questions or less when opening a bank account online or they will abandon the process. Meanwhile, just over one in four (26%) will drop out if asked more than five questions.

Regardless of the number of questions asked, one in five Filipinos will give up on a personal bank account application after 10 minutes.

In the past year, more than half of Filipinos have noticed more identity checks when they log in to bank accounts (58%) or make an online purchase (61%).

This increase in identity checks by Filipino banks is a direct response to the significant issue of identity theft in the country. Just 5% have confirmed that their identity has been fraudulently used to open an account, but one in four (26%) suspects that it has.

Despite this, frustration with identity checks can alter consumer behavior. The FICO survey revealed that one in four bank customers have either stopped or reduced their use of existing personal bank accounts and credit cards, citing the cumbersome and time-consuming nature of these identity verification processes.

Mortgages and loans application need more scrutiny

However, Filipino consumers show varying levels of patience for different account opening processes. They are most likely to abandon personal bank account applications (32%) due to complex or time-consuming identity checks. Close to one in three (30%) have abandoned savings account applications for the same reason, while roughly one in five (21%) have been frustrated enough to abandon mortgage applications.

Additionally, only 6% of Filipino consumers feel comfortable opening a mortgage account through digital channels, while more than half (52%) prefer to apply for personal loans in person at a branch, rather than opting for online alternatives.

While some consumers are more tolerant of detailed processes for certain financial products that require thorough scrutiny, the survey clearly shows that expectations for ease of use remain high.

“As banks encourage more customers to use digital services by promising faster online loan approvals, reducing consumer frustration caused by lengthy identity checks must be an imperative,” added Sharma. “Nearly half of Filipinos (49%) will not complete a digital mortgage application if it has more than ten questions, and more than half (59%) of personal loan applicants will abandon the process after ten questions.”

Founded in 1956, FICO is a pioneer in the use of predictive analytics and data science to improve operational decisions. FICO holds more than 200 US and foreign patents on technologies that increase profitability, customer satisfaction and growth for businesses in financial services, insurance, telecommunications, health care, retail and many other industries.

(Photo from Pixabay)