Many lenders have now introduced the ability for consumers to review and agree their finance documentation by electronic means, both on or off dealer premises.
EID&V is often incorporated into the customer journey with lenders using a range of methods to authenticate the customer including:
- Knowledge Based Authentication (KBA) – requiring the customer to answer questions only they knowthe answer to.
- Credit Reference Agency checks on the information the customer provides.
- Facial recognition checks – where a photo of the customer is provided through the lender’s EID&V system and checked against images of validated photo-ID stored in secure databases.
Benefits and restrictions of using an electronic onboarding process
| Benefits | Restrictions |
|---|---|
| Consistent of explanations / process | Not always available for all types of agreement or provided by all lenders |
| Convenient and time efficient | Technology failure – which sometimes requires a manual process to be reverted to |
| Paperless | False positives – where an EID&V system rejects valid prospective customers, requiring manual processes |
| Fully auditable | |
| Improved security | |
| Reduction in errors |
A typical digital customer journey will involve the following inputs and actions:
Dealer:
- Creates and processes the consumer proposal via the lenders online system.
- Confirms with the customer that they are happy to proceed with the e-signature process
- Where the customer is on-site, the lender usually requires the dealer to hand over their device (e.g. laptop / iPad) to the customer for them to proceed.
- Where the process is undertaken off-site, the dealer will inform the customer that they will receive communication (usually in the form of an e-mail link) where the process is similar to the above (on-site) process.
- Dealer staff should always follow the guidance provided to them by the relevant lender.
Customer:
- Will need to successfully pass an EID&V check or provide identity documentation such as a driving licence if identity cannot be verified electronically.
- The customer then receives the full set of pre-contract documents (adequate explanation and pre-contract information) to read and review online before they electronically sign the agreement.
Lender:
- Where the customer fails a check or there is a fall down in the process the lender may need to provide guidance to the dealer or customer.
- If the e-sign and/or EID&V process cannot be completed then manual checks will need to be undertaken and/or a paper version of the agreement might need to be signed.