Streamlined Onboarding: 40% Faster, Improves Client Satisfaction

Streamlined Onboarding: 40% Faster, Improves Client Satisfaction

Executive Summary

Vanguard Point Advisors, a growing RIA managing over $500 million in assets, struggled with a cumbersome, paper-based onboarding process, leading to delays and client dissatisfaction. Golden Door Asset implemented a fully digitized onboarding solution, automating document collection, KYC/AML compliance, and providing a secure client portal. This streamlined process reduced onboarding time by 40% and improved client satisfaction scores by 25%, resulting in stronger client relationships and a reduction in early client attrition.

The Challenge

Vanguard Point Advisors experienced significant challenges stemming from its outdated, manual onboarding process. The traditional process involved:

• Paper-Based Forms: New clients were required to complete lengthy paper forms, often exceeding 50 pages, detailing their financial history, risk tolerance, and investment goals. The sheer volume of paperwork was overwhelming for clients and time-consuming for Vanguard Point Advisors' staff to process.

• Manual Data Entry: Staff members manually entered data from paper forms into various systems, including CRM, portfolio management software, and compliance databases. This process was prone to errors, requiring significant rework and potentially leading to compliance violations. It took an average of 8 hours of staff time to onboard a single client.

• KYC/AML Delays: Verifying client identity and ensuring compliance with Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations was a slow and arduous process. This often involved manually cross-referencing client data with various databases, leading to delays in account setup. The average KYC/AML check took 3 business days to complete.

• Lack of Transparency: Clients lacked visibility into the onboarding process, leading to frustration and anxiety. They were often left wondering about the status of their account setup and unsure of what steps were required of them.

• Impact on AUM: The inefficient onboarding process was also impacting Vanguard Point Advisors' ability to grow its assets under management (AUM). The lengthy onboarding time deterred some potential clients and contributed to a higher rate of client attrition within the first 90 days. They estimated losing approximately $2 million annually due to onboarding-related client dissatisfaction.

• Compliance Risks: The manual process introduced significant compliance risks. Errors in data entry or delays in KYC/AML verification could lead to regulatory scrutiny and potential fines, estimated at up to $50,000 per incident for severe compliance breaches.

The Approach

Golden Door Asset worked closely with Vanguard Point Advisors to develop and implement a comprehensive, digitized onboarding solution that addressed each of the identified challenges. The strategic approach involved the following key elements:

1. Process Mapping and Optimization: We began by mapping out Vanguard Point Advisors' existing onboarding process, identifying bottlenecks and areas for improvement. This involved interviewing stakeholders, observing workflows, and analyzing data on onboarding times and client satisfaction.

2. Digital Form Creation: We replaced the paper-based forms with dynamic, online forms that clients could complete securely from anywhere. These forms were designed to be user-friendly and intuitive, guiding clients through the necessary information in a clear and concise manner. The forms utilized conditional logic to only display relevant questions based on the client's profile, reducing the amount of time needed to complete them.

3. Automated Data Integration: We integrated the online forms with Vanguard Point Advisors' CRM, portfolio management software, and compliance databases. This eliminated the need for manual data entry, reducing errors and saving valuable staff time. Data was automatically populated into the relevant systems, ensuring consistency and accuracy.

4. KYC/AML Automation: We integrated with leading third-party KYC/AML compliance tools to automate the verification process. This allowed Vanguard Point Advisors to quickly and efficiently verify client identity and ensure compliance with regulatory requirements. The automated system flags any potential issues for review, allowing compliance officers to focus on high-risk cases.

5. Secure Client Portal: We developed a secure online client portal that provided clients with 24/7 access to their account information, onboarding status, and relevant documents. The portal also included a secure messaging feature for communicating with Vanguard Point Advisors' staff. The portal featured two-factor authentication to ensure the security of client data.

6. DocuSign Integration: Integrating DocuSign enabled clients to electronically sign documents, eliminating the need for printing, scanning, and mailing paper forms. This further streamlined the onboarding process and reduced processing time.

The decision framework prioritised security, compliance, and user experience. We selected technologies and integrations based on their ability to meet these criteria and provide a seamless onboarding experience for clients.

Technical Implementation

The technical implementation of the streamlined onboarding solution involved a combination of custom development, third-party integrations, and cloud-based infrastructure. Key components included:

• Frontend Development: The secure client portal and online forms were developed using React, a popular JavaScript library known for its performance and user-friendly interface. The React frontend was designed to be responsive and accessible across various devices, including desktops, tablets, and smartphones.

• Backend Development: The backend infrastructure was built using Node.js and Express, a robust and scalable framework for building web applications. The backend handled data processing, integration with third-party systems, and user authentication.

• Database: We utilized a PostgreSQL database to store client data and ensure data integrity. PostgreSQL is a reliable and secure open-source database management system that is widely used in the financial services industry.

• DocuSign Integration: We integrated DocuSign's eSignature API to enable clients to electronically sign documents. The integration allowed Vanguard Point Advisors to send documents to clients for signature directly from their CRM and track the status of each document.

• KYC/AML Integration: We integrated with a leading third-party KYC/AML compliance provider, utilizing their API to automate identity verification and compliance checks. The integration allowed Vanguard Point Advisors to automatically screen clients against sanctions lists, PEP lists, and other relevant databases.

• CRM Integration: We integrated with Vanguard Point Advisors' existing CRM system (Salesforce) to ensure seamless data flow and eliminate the need for manual data entry. Client data from the online forms was automatically populated into the CRM, providing advisors with a complete view of each client.

• Security: We implemented robust security measures to protect client data, including encryption, multi-factor authentication, and regular security audits. All data was transmitted securely using HTTPS.

The integration of the KYC/AML tools calculated compliance risk scores by analyzing data from multiple sources. These risk scores help Vanguard Point Advisors prioritize their review process and focus on potentially high-risk clients, reducing the chance of money laundering activities.

Results & ROI

The implementation of the streamlined onboarding solution yielded significant results for Vanguard Point Advisors:

• Reduced Onboarding Time: The average onboarding time was reduced by 40%, from 10 days to 6 days. This freed up valuable time for advisors to focus on client relationships and business development.

• Improved Client Satisfaction: Client satisfaction scores, measured through post-onboarding surveys, increased by 25%. Clients reported a more positive and efficient onboarding experience.

• Reduced Staff Time: The automated data entry and KYC/AML processes reduced staff time spent on onboarding by 50%. This freed up staff to focus on more strategic tasks, such as client service and investment management. The estimated savings in staff time was equivalent to $30,000 per year.

• Reduced Client Attrition: Client attrition within the first 90 days decreased by 15%. This was attributed to the improved onboarding experience and the increased level of engagement with clients.

• Increased AUM Growth: The streamlined onboarding process and improved client satisfaction contributed to increased AUM growth. Vanguard Point Advisors reported a 10% increase in new client acquisitions in the first year after implementing the solution, translating to approximately $50 million in new AUM.

• Reduced Compliance Costs: Automating KYC/AML compliance reduced the risk of errors and compliance violations, leading to a significant reduction in compliance costs. They avoided an estimated $20,000 in potential fines.

The ROI was calculated based on the reduced staff time, increased client retention, and new AUM acquired. The total estimated ROI in the first year was $80,000.

Key Takeaways

Here are some key takeaways for other RIAs looking to improve their onboarding process:

1. Embrace Digital Transformation: Ditching paper-based processes and embracing digital solutions can significantly improve efficiency and client satisfaction.
2. Automate KYC/AML Compliance: Automating KYC/AML compliance not only reduces costs and risks but also speeds up the onboarding process.
3. Provide a Seamless Client Experience: A user-friendly client portal and streamlined online forms can make a significant difference in client perception.
4. Integrate Systems for Efficiency: Integrating different systems, such as CRM and KYC/AML tools, eliminates manual data entry and ensures data consistency.
5. Monitor and Measure Results: Track key metrics, such as onboarding time and client satisfaction scores, to measure the impact of your onboarding improvements.

About Golden Door Asset

Golden Door Asset builds AI-powered intelligence tools for RIAs. Our platform helps advisors enhance their client experience by automating manual tasks, providing personalized insights, and ensuring compliance. Visit our tools to see how we can help your practice.