For crypto platforms, a robust AML and KYC onboarding process is the first line of defense against cybercriminals—but it’s also the first touchpoint of customer interaction.
With the cryptocurrency markets’ threat landscape continuously evolving (losses to crypto investment scams in the US totaled $3.94 billion in 2023) and penalties for non-compliance mounting ($5.8bn in 2023 over inadequate AML programs), ensuring stringent regulatory compliance while providing a friction-free onboarding experience is critical to success.
However, the challenge often lies in the perceived tradeoff between usability and security – Smart design can bridge this gap. Intuitive interfaces and clear guidance can ensure strong AML and KYC compliance while keeping the onboarding process smooth and user-friendly.
UX & UI Design for Enhancing Security in AML Onboarding
AML regulations vary by jurisdiction but typically include verifying client identities through Customer Identification Programs (CIPs) and reporting suspicious transactions, providing Enhanced Due Diligence (EDD) for high-risk customers, and maintaining detailed transaction records.
Intuitive User Interface: Designing a user-centric interface that guides clients through the AML process can significantly reduce friction and abandonment rates. Features like progress bars and tooltips enhance user understanding. For a crypto startup client, we designed a simple, clean UI to demystify cryptocurrency trading. We added UX elements that explain why certain personal information is needed at each step, reassuring users and making the onboarding process less tedious. Intuitive UI elements such as tooltips, password suggestion messages, and interactive features were incorporated, resulting in a 40% increase in signups from novice traders. This demonstrates how thoughtful design can streamline onboarding and build user confidence.
Strong Encryption Protocols: End-to-end encryption is crucial for converting sensitive information into a random code, ensuring only the users can see the data. This method is essential for apps where calls, texts, videos, images, and documents are frequently exchanged, which is likely true for most crypto apps. Designing encryption from a UX and UI standpoint involves communicating encryption protocols through concise, non-technical explanations during the onboarding process.
Visual indicators, like lock icons, can signify secure sessions, reinforcing trust. Encryption settings can be designed for easy accessibility, with advanced settings simplified through toggles and clear labels.
Secure Authentication: Robust authentication ensures that only the account owner can log in, preventing unauthorized access. Implementing two-factor authentication (2FA) adds an extra security layer, sending a login code to a mobile phone or email address. HSBC’s integration of facial recognition and biometric authentication is aimed at boosting boost user trust and reducing fraud attempts.
Maintaining Friction Balance: In most FinTech onboarding apps, eliminating friction is the designer’s ultimate goal to minimize abandonment rates.
In crypto solutions, however, a certain level of friction is often required, especially when a user’s finances are on the line. By adding just the right amount of friction at the right time, UX designers can ensure users remain satisfied with the overall product experience while instilling a sense of reliability that their finances are protected against unwanted accidents. With users being able to create a new account in as little as 5 minutes, Robinhood provides a fantastic friction balance for new users. The app also efficiently captures new user information with a minimalistic design, requiring only 11 onboarding fields to fill over 14 click actions.
Closing Thoughts
The recipe for a successful AML onboarding process is deceptively simple: use a clean UI and accelerate onboarding timelines, and you’re done. However, bridging the gap between AML and design expertise, holding bad actors accountable, incentivizing compliance, and embedding a culture of compliance across departments are all essential.
Of course, design can simplify and enhance the AML onboarding process, transforming it from a checkbox task to an engaging experience. Yet, true effectiveness requires integrating AML expertise and fostering a compliance-first mindset within your FinTech business.
