Tilt toward online account opening's already here

Bankers preparing for the day when digital channels will dominate account opening should rethink their schedules. That day might already have arrived, says Javelin Strategy and Research.

The checking account—the fundamental bank account that Americans have long established face-to-face at a branch—is at a tipping point. Javelin research indicates that 70% of likely applicants would prefer to submit a digital application in 2015.

The far-reaching implications apply not only to the “branch of the future” but also to the branch-centric culture of banking itself. Javelin’s research finds Americans are increasingly comfortable with digital channels to open various financial accounts.

In 2014, more Americans applied for credit cards and a variety of loan and investment accounts through online and mobile channels—with the volume of applications on smartphones and tablets jumping more than 60% for auto loans, mortgages, and credit cards, according to Javelin.

Banks must still overcome consumer perceptions

While digital account opening is winning for many, there are still several perceived weaknesses that financial institutions must address. Notably, for digital channels to gain usage, they must counter the perception that branches have the edge when it comes to protecting personal data (69% vs. 31%) and for obtaining answers to questions (60% vs. 40%).

“Financial institutions will win by ensuring that applicants feel the outcome was smooth and seamless even if they start the process in one channel and finish in another. Applicants should never have to start over from scratch,” says Mark Schwanhausser, Javelin’s director of Omnichannel Financial Services.