Add Value Through Seamless Credit Card Origination

March 31, 2012 by  Filed under: Credit 

I recently applied for a credit card online and my experience surprised me-it was easy, convenient, and actually pleasant. My experience got me thinking about credit card origination and how banks can add value and build customer loyalty just by creating a positive account origination process. The key to adding value through this process is by having a credit card origination platform that enables financial institutions (FIs) to make quick lending decisions while still protecting the FI from fraud in channels with more risk, such as online. To add even more value, FIs can allow for personalization of the customer experience and use cross-sell to deepen the relationship to prevent attrition.

My card-obtaining experience started with filling out an application. I was surprised at how little information was required of me-typical information like birth date, address, SSN, and estimated yearly income. The application was so easy to fill out, I don’t even recall filling out most of the required information and I never even left my couch. This is where a high-quality credit card origination solution comes into play. The FI only required basic information from the applicant; the rest was acquired through an integrated data aggregation solution. Innovative credit card origination solutions will be integrated with connections to a variety of data providers. The FI can then choose which data will compliment their processes and mitigate risk. By using integrated data sources, FIs can make the application process quick and simple for consumers to complete while still protecting themselves from incurring losses.

As my application was being decisioned, I was able to customize things like what image I wanted on my card. We live in a society where individualism and customization are highly valued, so being able to customize something small like the color or image that appears on a credit card can hold intrinsic or emotional value for consumers. Also, since I was distracted by choosing which pretty flower I wanted on my card, the time it took to approve my account seemed shorter. Once my application was approved, I was taken directly to my account preferences where I was able to customize my interactions with the FI. I was able to set up a username and password for my online account, sign up for paperless statements, and register for text/mobile banking. If the FI hadn’t used a credit card origination solution that was able to return a realtime decision, I would have been required to wait until I was notified that my application was approved, go online and sign up for their online banking account using my account number, and find the preference page before I would be able to customize account settings. By creating a seamless experience, the FI can create positive customer experiences which enhances the value the customer places on that brand.

The results from my application were sent quickly. I didn’t have to wait for an e-mail or a letter by snail mail. Modern credit card origination solutions allow FIs to automate many processes while still providing the option of manual reviews in case of fraud suspicion or more customer information being required. Decisions can be returned faster as more steps in the process are automated, but the FI can also use manual reviews to mitigate risk and make sound lending decisions. Returning a decision in realtime enhances the customer experience because there is no waiting involved and the account can be used that same day.

Not only did I have an impressive account origination experience, but the FI used cross-sell in an effective and convenient way as well. During the application process I was asked if I was interested in a number of other services. I had indicated that I was interested in a balance transfer, so after my application was approved, a balance transfer page was brought up. I entered in my other bank and the amount I wanted transferred, and the next page automatically had all of my previous bank’s information pre-filled so I didn’t have to look into my records to find it. Again, I didn’t even have to leave the couch to complete the transfer. Cross-sell is an important part of deepening customer relationships. A customer who holds multiple products with a FI is less likely to attrite, and is more loyal to the institution. Innovative credit card origination solutions allow FIs to integrate all lines of business in order facilitate cross-sell and communication across the enterprise.

The cherry on this ice cream sundae was the rewards program. I was able to sign up for the rewards program of my choosing. Allowing the customer to choose which rewards are more important to them is a great way to add value and give more incentive to use the credit card. With regulations such as the Durbin Amendment, FIs can use incentives like these to encourage the use of credit instead of debit to recoup lost revenue. Customers receive value through gaining rewards for making everyday purchases which, in turn, increases the profitability of that customer for the FI-a win-win.

The back-end processes that facilitate credit card origination must be able to provide access to a variety of data providers, return decisions quickly, and integrate all lines of business across the enterprise in order to create a seamless application process. Simple and convenient account origination adds value and leads to increased loyalty and deeper customer relationships.

Kristie Heinemann is an online marketing expert for Zoot Enterprises. She graduated from the University of Wisconsin La Crosse with a BS in Marketing and Spanish.

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