With endless credit card offerings on the market, it can be difficult to stand out against the competition. Yet while having an interesting rewards program or unique benefits may steer consumers toward one card, a tedious application process consisting of confusing flows, extended questionnaires and an outdated look may push potential customers away.
To better understand what card-issuing banks and credit unions are doing well and where they could do better, Amount’s GTM Strategy and Insights team underwent a credit card mystery shopping exercise. Our findings made it clear that both credit unions and banks lack the digital innovation expected by today’s consumers and have necessary adjustments to make: some are simply table stakes, others will ensure a product is favored.
Here we break down the good, the bad and the ugly of today’s credit card applications
The Mystery Shopping Process
Before we delve into our findings, let’s clarify our process. To gather data on the user interface (UI) and user experience (UX) of credit card applications, the Amount team completed applications offered by 10 credit unions and 12 banks on both mobile and desktop. The specific cards applied for ranged from partner specific, to specialized rewards, to general offerings.
It’s important to note that none of the applications were submitted. This means we’re not entirely sure how verifications work or what follow-up steps look like. But even without submitting the applications, the research team at Amount gathered insightful intel by experiencing the different applications.
Nearly all of the applications – 90%-- allowed non-members to apply for a card without having to become a member or sign in to an existing account. Even more, 100% of applications offered easy and convenient prefill functionality, enabling the applicant to simply upload a photo of their U.S. driver’s license instead of typing out their full name, address and date of birth. And while both of these features are great to have, they are also expected – and potential customers will surely drop from the process without them.
Shorter applications and more fluid UI/UX flows allowed for an easier and more positive experience. By utilizing visual cues via strategic design elements, the shorter applications were able to highlight important information and seamlessly guide the applicant through the experience. The shorter applications also prevented our mystery shoppers from being slowed down or overwhelmed by multiple pop-up screens.
Unfortunately, too many of the applications weren’t quick and simple. Instead of offering text boxes, some spanned multiple web pages and had endless options in drop-down menus, making for a tedious process. For example, one drop-down menu included over 70 options for “occupation,” ranging from “clergy/pastor” to “pawn broker.” The list was alphabetically organized, so a UX interface designer, for instance, would have to scroll through all of the other options before arriving at theirs. No doubt a prospective customer’s attention will dwindle when forced to endure extensive and annoying questionnaires.
We also discovered numerous discrepancies among required fields. For example, some institutions asked for what appeared to be extraneous information on housing or residency status. Perhaps these additional fields may be needed from a fraud perspective. However, considering the many applications with far fewer fields, this leads us to believe that with the right fraud system, unnecessarily long applications could be shortened.
The most shocking aspect of our credit card application research was the lack of required or accessible Schumer Boxes that hold vital information on the card, including APRs and fees (i.e., annual, cash advance, late payment, etc). To our surprise, there were a handful of applications that actually made the box difficult to find or did not require viewing. Boxes were often hidden in small text links, which let our mystery shoppers continue onto the next page without a glance. Making this information required and easily accessible is critical to ensuring the applicant is well-informed on a card’s features. Yet, remember, our applications were not submitted, so there is a chance that the application could not have been submitted if the applicant didn’t view the Schumer Box.
So why does any of this matter?
Because just as with every other aspect of the retail marketplace, consumers expect to have quick and easy digital brand experiences – and they are quickly and easily frustrated if they don’t. According to a survey completed by Signicat, 50% of customers applying for online financial services abandon their application before completion. The top two reasons, which combined accounted for 74% of all abandonments, included the amount of information required and the amount of time it took to complete the application. Other reasons included the need to send identity documents and confusing languaging. Labor-intensive and uninituive application processes can pretty much guarantee half of potential customers won’t even hit submit.
To keep consumers engaged in the credit-card application process, financial institutions need to meet their expectations with simple and seamless digital experiences. And this doesn’t necessarily require an overhaul of an organization's existing infrastructure. Today technology solutions exist that are flexible and modular, allowing an organization to fill in its gaps – not replace its systems – and continue to iterate and improve its digital offerings. Equally important is working with a technology partner that is committed to understanding a bank or credit union’s digital readiness and developing the right go-to-market strategy and experience for its credit card applications. A strategic partnership as such empowers financial organizations to revolutionize the way it attracts, acquires and retains customers over the long term.
While financial institutions have already built the foundation for a great credit card application, as our mystery shopping research reveals, there is certainly room for improvement– and with so many clunky, laborious and time-consuming applications, it’s no mystery where those improvements need to be. After all, it’s 2022, and it shouldn’t be so difficult to apply for a credit card.