If 90% of banking professionals say onboarding's mission-critical, why do 52% admit their own processes drive clients away? A YouGov survey commissioned by nCino highlights this contradiction. The banking sector's caught in a bind. Complex, inefficient onboarding processes create customer drop-offs, undermining the very relationships banks want to build.
The industry's been sprinting toward digitisation. Self-service platforms and algorithmic credit scoring promise speed and scale. But this rush has created impersonal, opaque processes that alienate clients. Sure, automation streamlines operations. It just fails to address what high-value clients actually need.
Leading banks fuse technology with human insight. They're backed by more flexible regulation, AI partnerships, and robust infrastructure. These elements create a hybrid model that balances efficiency with personal service.
The challenge starts with understanding where impersonal automation breaks down client trust.
Even the slickest digital interface can trip on the smallest crack of mistrust.
Automation Paradox
Automating routine tasks can speed approvals, but when those systems live in silos, they build hidden roadblocks that frustrate clients. Client dissatisfaction follows.
Consider Dhanushi Jayatileka at Commonwealth Bank, who was laid off the same day the bank rolled out an AI chatbot. The move, followed by a reversal on replacing 45 roles, shows the human cost of overzealous automation. Apparently, chatbots struggle with reading the room when clients need actual advice instead of scripted responses. Such actions erode trust, particularly for clients who expect advisors to navigate complexity rather than just execute transactions.
These failures show why balance matters between automation and personal interaction. Australia's prudential regulator has lightened the compliance load on lenders. This creates space for more relationship-driven banking.
With regulators now weighing in to ease banks' paperwork, the next move falls to policymakers.
Regulatory Relief
The Australian Prudential Regulation Authority (APRA) has eased compliance pressures on smaller banks, creating an environment where relationship managers focus on client engagement rather than paperwork. The three-tier prudential framework streamlines internal ratings-based accreditation for institutions below the major bank threshold.
APRA Chair John Lonsdale outlined amendments to the bank licensing framework. He's also enhanced transparency on Pillar 2 capital decisions. These changes reduce the administrative burden on smaller banks. They can now allocate more resources to client relationships.
With reduced form-filling and accreditation demands, credit teams build deeper borrower relationships. This regulatory headroom is essential for banks combining digital efficiency with personal service.
This lighter regulatory load also frees up resources for strategic AI partnerships.
That headroom is exactly what makes room for AI to step in as co-pilot.
AI Integration
Collaborations with AI innovators like OpenAI let banks automate routine tasks such as fraud detection and basic personalisation while redeploying staff into high-value advisory roles. The partnership between Commonwealth Bank and OpenAI focuses on enhancing scam and fraud detection alongside personalised banking services. Staff are getting schooled by algorithms, but at least they're learning to work with their digital colleagues rather than compete against them.
Under CEO Matt Comyn's oversight and in collaboration with OpenAI's Sam Altman, Commonwealth Bank employees gain phased access to OpenAI's tools. This includes ChatGPT Enterprise. The initiative includes training to improve AI literacy among staff.
By automating baseline checks and proposals, relationship managers devote more time to bespoke financial solutions. Not every institution can afford a tie-up with a tech giant, so smaller lenders are turning to open-source AI models or niche platforms to achieve similar outcomes.
But even with AI handling the heavy lifting, scaling still requires human expertise.
And teaching that expertise to a growing workforce is our next big hurdle.
Scaling Expertise
The challenge of scaling specialist lending lies in training mortgage brokers to act as relationship ambassadors.
Dedicated education programmes equip brokers with the skills to navigate complex deals without losing the human touch.
Mario Rehayem, CEO of Pepper Money since 2017, champions mortgage broker education and expanding the specialist lending category to improve consumer outcomes. His role involves developing programmes that enhance brokers' advisory capabilities and deep product knowledge. His appointment as Chair of the Australian Finance Industry Association in March 2024 highlights his involvement with broader industry education efforts.
This approach shows how broker education programmes support the scaling of human expertise by ensuring brokers are prepared to deliver personalised services in specialist lending.
Still, even the best-trained broker needs workflows that blend AI with judgement.
Hybrid Workflows
Capturing every nuance in complex commercial lending throws up more plot twists than a soap opera – algorithmic scores alone just don't cut it.
Hybrid credit workflows marry algorithmic scoring with hands-on review for edge cases.
Martin Iglesias, a credit analyst at Highfield Private with over 20 years of corporate banking experience, integrates automated credit-scoring tools and digital origination platforms while reserving manual engagement for borderline and complex cases. His experience includes structuring multi-layered working capital facilities that supported an online retailer's growth to a $250 million operation, arranging $10 million in construction financing for a campus expansion, and securing over $30 million in lending facilities for a real estate agency. His method combines algorithm-driven assessments with detailed risk analysis and personal engagement to fit financing precisely to client needs.
This approach shows how a hybrid credit workflow balances efficiency and deep risk analysis to ensure that financial products meet complex client requirements effectively.
Once your credit process can flex between code and conversation, the rails beneath it have to be rock-solid.
Neutral Payment Systems
Reliable payment rails are essential for delivering personalised financial services across diverse platforms.
Neutral payment rails give banks the stability to customise services across any channel.
Craig Kennedy, Managing Director of Cuscal Limited, provides end-to-end payment services that serve banks, corporates and fintechs. Cuscal is one of only five providers in Australia offering comprehensive payment infrastructure. During the first half of FY25, the company recorded 7% volume growth, which translated into a 12–13% profit increase.
This approach shows how neutral, independent rails underpin scalable, personalised customer experiences by enabling diverse financial entities to innovate without building core systems.
With those rails in place, all the pieces finally click together.
Sustainable Banking Models
Policy flexibility, AI augmentation, specialist expertise and neutral infrastructure form a clear roadmap for modern banking. Over-reliance on either pure automation or pure manual processes risks client drop-offs or runaway costs.
For banks and fintechs, auditing digital versus human workflows is essential for recalibrating resource allocation. Understanding where technology can enhance efficiency without eroding personal connections is key.
Maintaining an intentional balance protects client trust, staff expertise, and long-term profitability. By strategically aligning resources with both digital tools and human insight, financial institutions ensure sustainable growth.
These lessons converge in one simple truth: you still need the human algorithm.
The Human Algorithm
Technology may set the stage, but only human insight drives enduring relationships and profitable growth. Banks that marry digital tools with genuine relationship expertise currently lead the market.
The banks closing the digital onboarding gap have nailed the blend of speed and empathy. Despite all our technological advances, personal connections remain at the heart of successful banking relationships. Trust still begins face-to-face.
A digital handshake can unlock doors, but it's the human one that builds lasting bridges. In an era where technology continues to evolve rapidly, maintaining this balance is key to sustaining client trust and achieving long-term success.
If your onboarding still feels like a digital blind alley, now's the moment to map where tech ends and relationships begin.
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