Digital identity is one of the fastest growing technology sectors in the world and we saw there was a huge opportunity to be seized.
A new way to build mutual trust
As traditional institutions increasingly come under threat from fintechs, challenger
banks and big tech companies, Rabobank realised that its existing services are under threat from commodification and disintermediation by competition. Conversely, consumers and businesses in the age of password fatigue and hackers, need a new way to build mutual trust and ensure that the business is legitimate, and the customer is genuine.
As a trusted entity, Rabobank knew it was in pole position to take its brand equity, customer data, and position in the value chain, to provide a digital identity service to improve the speed, security and utility of online commerce. It needed to focus on trust, not transactions.
The challenge Rabobank’s enterprise clients faced was that KYC and AML regulations demand banking grade identification and authentication of end users. This required additional processes that degraded the user experience. The majority of this is analogue, not digital. This means staff have to manually check passports and driver’s licenses, by hand in person. Rabobank wanted to develop a digitised service that could be rolled out for its enterprise clients to make on- boarding simpler and more convenient for the end user to increase online conversion and ensure compliance.
Rabobank is an international financial services provider headquartered in the Netherlands, serving 8.4 million clients around the world. It is a cooperative bank with an unparalleled knowledge in the food and agricultural industry. Measured by Tier 1 capital, Rabobank Group is one of the world’s largest financial institutions.
Rabobank needed a partner that understood the digital identity space to help build a new platform. With a decade of experience working with electronic IDs (eIDs), and hundreds of financial institutions using its trusted digital identity services, Rabobank identified and selected Signicat to collaborate on the project. Together, they launched Rabo eBusiness, a bank-led Digital Identity Service Provider (DISP). It was launched in the Netherlands in 2017 and is the first of its kind globally.
The DISP brings together Rabobank’s experience with large, multi-national enterprises, Signicat’s digital identity technology, and a host of identity scheme providers. The result is a single, cross- border method for digital on-boarding, login, signature and archiving that avoids cumbersome UX for consumers and high manual costs for enterprises. Rabo eBusiness is marketed to and used by energy, telecom and insurance companies, healthcare institutions and financial service providers.
The platform enables end users to use a range of identity schemes to access online services, including the Dutch IDs, iDIN and DigiD, others from around Europe including NemID and Freja ID, and social logins such as Google. This means that Rabo eBusiness clients can let their customers decide how they want to identify themselves digitally and conveniently. As this includes eIDS from across Europe, it makes cross- border account opening or on-boarding simpler too. It also removes the risk of unfamiliar documents passing through manual checks. Enterprises can accept customers from across Europe, while still meeting regulatory demands. End users can log onto the service providers’ website using one of the identity services and can then for example sign a contract, meaning the whole process is 100% digital.
Since collaborating to create the DISP, Rabo eBusiness has been able to increase online conversion for its enterprise clients. Its first customer was Rabobank itself, digitally on-boarding customers for its insurance and mortgage arms. Since it went live in January 2018, Rabo eBusiness has on-boarded over 190,000 customers and made considerable savings for Rabobank.
The majority of customers on- boarded are signing up for insurance products with Rabobank’s partner provider. A fairly straightforward identity process means the cost per identification has reduced from €1.20 to €0.50, translating to 58% saved per transaction by using Rabo eBusiness.
However, with an average of just over 30,000 customers identified each month, the total savings made add up to €127,484.
Mortgage lending means a much more involved KYC process to minimise the risk of fraud. Manual processes here cost an average of €37.50 per customer, when the cost of labour is included. So while far fewer mortgage customers have been on-boarded—10,000— Rabobank has saved €375,000 by using Rabo eBusiness.
In total, Rabo eBusiness has saved Rabobank €502,848 in the time since launch, while also offering customers a far better experience—identifying themselves digitally rather than using slow and frustrating manual methods.