Financial Services Industry Use Cases for Remote Online Notarization
Remote Online Notarization (RON) is an emerging service that enables commissioned notary publics to render their notary services remotely and securely using audio-visual technology. Its applications are many and varied, whether enabling powers of attorney, signing affidavits, or signing deeds. In this blog, we’ll review the financial services industry use cases for remote online notarization and explore how online notary services in financial institutions can deliver value to the signer, remote online notary, and institution alike.
COVID-19 and Rise of Remote Online Notarization
The COVID-19 pandemic and associated government policies changed the way business is done. Suddenly, organizations of all sizes needed to find remote solutions to ensure business continuity. In response, many states passed temporary emergency legislation to permit RON as a legal notary service.
With the pandemic passed, the shift in consumer preferences and business processes has not reverted back to the pre-pandemic sensibilities. Consumers enjoy the option of remote processes, and there is now demand for organizations to continue providing them. Meanwhile, this shift is also driving financial institutions to further their digital transformations and close more bank branches.
There is no longer a need for financial institutions to offer remote online notarization. Post-pandemic, RON is now an opportunity. FIs interested in RON have the opportunity to accelerate their notarization process, elevate the customer experience, and eliminate document errors in a secure, trusted environment.
Benefits of RON for Financial Institutions
There are several key benefits remote online notarization brings to financial institutions, including:
- Notary accessibility: Customers can have trouble arranging a meeting with a notary. Notaries and their customers both work during traditional working hours, meaning there are few opportunities to notarize in the evenings and weekends when customers are most available. Rural customers may also have long distances to travel, and branch closures exacerbate the problem. RON can be performed at any location (where RON laws have been passed supporting its use) and any time in a faster, more efficient process.
- Strong electronic evidence: To facilitate compliance and enforceability of contracts, RON solutions collect significant electronic evidence of the notary act. This includes an eJournal, audit trail, and recording of the session.
- Eliminate document errors: A digital notarization process ensures that each notarized document is completed correctly preventing the need to reprint, recirculate, and re-sign a document on account of some small oversight.
- Easy for signers and notaries: RON solutions, like OneSpan Notary, offer a refreshingly easy experience end-to-end and for all parties involved. OneSpan Notary offers clear, guided steps walking through the notarization process from beginning to end.
Learn more about the benefits of remote online notarization in this video:
Top Use Cases for Remote Online Notarization in Financial Services
Wealth management as an industry is undergoing significant digital transformation, and not every firm is keeping pace. A survey from Advisor360° found that 65% of wealth management firms have lost business, because they did not offer sufficient digital tools to meet customer demands. In an industry centered around the interpersonal relationship between the advisor and the account holder, customer experience is paramount.
Remote online notarization can help wealth management firms manage their clients’ trusts and estates remotely. RON is a key enabler to a digital experience to facilitate changes to important documents such as estate planning, transfer investments, beneficiary changed, retirement distributions, and trustee certifications. Delivering that unique, unmatched customer experience to high-net worth individuals helps a firm attract and retain digitally-savvy customers.
Auto financing has historically been an in-person process taking place at the dealership. The borrower meets with the lender, their identity is verified, their credit history is reviewed, and the loan is secured. A digital version of this process is both faster and more convenient. Upstart Auto Retail determined that their digital solution was completed 50% faster than the traditional in-person method.
Auto lenders can use remote online notarization services to complete contracts such as car title transfer / ownership of vehicle, lien release, vehicle certificate of ownership, and refinance contracts in a matter of minutes. Auto lenders can validate the signer’s identity, e-sign and notarize contracts all in a secure videoconferencing session.
Insurance has been more resistant to digitization than other financial services industries. Its business model has remained profitable and functional, but consumer preferences are ultimately changing priorities. Since the pandemic, many insurance providers, particularly those with large, external agent teams have taken steps to reduce their dependence on paper and in-person meetings. Insurance technology spending in the US and UK is expected to grow by over 25% between 2022 and 2026.
With remote online notarization, insurance companies can provide a differentiated customer experience for claimants through a secure videoconferencing session to remotely notarize a number of contracts in real-time such as beneficiary changes forms, retirement distributions, claims processing forms, life and annuity claims, policy changes, payment redirects, and adjuster licensing forms.
RON technology helped the mortgage industry overcome a key challenge during the pandemic by enabling homebuyers to have their electronic documents notarized remotely in a live virtual session. Though valuable during the pandemic, RON is now becoming a standard option for mortgage closing forms and mortgage refinancing forms across the U.S. with 40 states having passed legislation for RON.
According to MarketWise Advisors, RON produces positive ROI for mortgage brokers, because real estate transactions can be closed faster, with fewer errors and lower costs than those in legacy processes. A title agent can save up to $100 per transaction, and lenders can save up to $444 per loan while reducing the time-to-completion by 2.5 hours.
OneSpan Notary Supports RON for Financial Services
OneSpan Notary can help financial institutions maintain the level of ease and convenience their customers have come to expect from remote processes. If your organization is pursuing a RON solution, it is important to familiarize yourself with your local regulations and legislation governing the use of remote online notarization and notarial acts as specifics will vary state by state. Consult your legal department for advice on issues related to electronic notarization.
Contact us to learn how we can help your organization support Remote Online Notarization.