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Schwab to Launch Digital Account Onboarding for Advisors in July

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What You Need to Know

  • The new Digital Account Onboarding tool is part of a second wave of Digital Account Open capabilities.
  • Already planned is a third phase enabling household onboarding.
  • Schwab hasn't had a major security breach yet, but it has multiple initiatives in place to fight hackers.

Charles Schwab will launch a new Digital Account Onboarding tool for advisors and their clients in July, part of what Andrew Salesky, senior vice president of Schwab Digital Advisor Solutions, said is part of a “second major wave” of its Digital Account Open capabilities.

The new tool “builds on Schwab’s existing Digital Account Open solution and delivers a more secure, streamlined account open, funding and setup process for advisors and clients, supporting most common account types and onboarding tasks,” according to the company.

The “overall journey on Account Open” has been a “multi-year effort” by Schwab, but it is now on a “very accelerated path,” Salesky told reporters during a Technology Tuesday briefing.

“Following on the heels” of next month’s Digital Account Onboarding launch, there is a “third phase that we are working on where we will enable multiple accounts with funding integrated into a single digital envelope, so really enabling household onboarding,” he said.

There are “three legs of our technology strategy, which the integration” of Schwab with TD Ameritrade is “really helping us to accelerate,” he noted. “The first leg of that strategy is everything that we’re trying to do to streamline processes and reduce rework, [while] trying to bring down” not in good order (NIGO) rates “across everything that we do,” he explained.

The “second leg” of Schwab’s tech strategy includes “everything that we’re doing to scale and modernize trading and investment management,” while the “third leg is all about delivering customizable features and insights,” he added.

Schwab still expects the integration with TDA to take 30 to 36 months, at the high end of its original forecast. Once the broker-dealer consolidation is finalized, the Schwab Advisor Center will serve as its single, integrated custodian site, according to Salesky.

The company will be “adding top features from day one,” he said, noting those features will include ones that “clients have signaled to us are ones that we need to ensure” will be offered, including dashboarding capabilities that were very successful on TDA’s Veo One platform.

More Tech Tool Plans

Also planned is an enhanced version of TDA’s iRebal rebalancing tool later this year. “The improvements we’re making are going to make it much more easy for us to enhance the platform going forward, signaling our long-term commitment to iRebal,” he said.

Meanwhile, Schwab is “fully building out our digital Move Money experience” on Schwab Advisor Center, he said, noting it is “where we have the highest level of digital adoption.”

The company is also improving digital account maintenance and already “revamped our status and alerts capability,” he said. “Now you’re able to find an update on everything you submit to Schwab … [and] now you can set it up for notification on specific items” that are most important to users, he explained, adding: “We’re very pleased that over 70% of advisors on the Schwab broker-dealer are using that new status capability.”

Anthony Halpin, chief operating officer and a founding partner of Schwab RIA client Chicago Partners Wealth Advisors, has been a fan of Digital Account Open and told reporters he is looking forward to a new Schwab client editing capability that he predicted will save “a lot of time for everybody” and “also really eliminate” — or at least “significantly reduce” — the number of NIGOs advisory firms have to deal with.

Cybersecurity Initiatives

Amid increased cybersecurity breaches across multiple sectors, Salesky, in response to a question by ThinkAdvisor, said Schwab was “very fortunate in that we haven’t seen or had a broad-based breach of any significance.”

Although there have been “cases of individual account takeover, we generally see that’s due to some issue on the client side that can occur, and we work towards [resolving] those very quickly,” he said. There is also a “Schwab guarantee in place and we think that gives great comfort to end clients,” he noted.

Schwab uses “multiple levels of security” because “nothing is more important than security at Schwab,” he said.

The security initiatives it has in place include the monitoring of IPs addresses, hardware and individual transactions, and it has “special processes in place for Move Money capabilities” and “dual factor requirements for trading,” he explained. “Now we’re having a dual factor requirement for Move Money” also, he noted.


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