Brokerages are missing a cost-effective opportunity to gain new customers and are lagging behind their banking peers by failing to offer online account opening services, according to a study from Boston-based Aite Group. Of the top 15 brokerages, only four (27 percent) allow new accounts to be fully opened in one online session, the study reports.
Traditional account opening processes (paper, in person or over the phone) cost an average of $65 each, compared to $15 for an automated online transaction, Aite estimates. As a result, the financial services industry (banks, brokerages, insurance companies) will spend $134.3 million on account opening automation in the next three years, up from $62 million from 2003-2005.
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