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How to become your customer's primary account

We’ll explore the best practices for motivating customers to switch direct deposit destinations, a first step to becoming their primary account.

August 12, 2021

Ashley Cornall
Ashley Cornall

Ashley Cornall is a product manager on the Financial Identity Team (FIT) at Plaid.


Consumer expectations for financial institutions are changing. Today’s customers expect more, experiment with more fintech solutions, and experience better financial outcomes. As a result, innovative financial institutions have quickly earned wallet share. Incumbents that continue to rely on what worked in the past may find themselves languishing in the new financial future. 

In an increasingly crowded financial services marketplace, how can established financial institutions remain relevant? How will they gain wallet share and increase LTV? And, what will it take to become and stay essential to their customers?

The solution lies in earning the customer’s direct deposit. By doing so, your institution increases the likelihood of becoming the primary account, which allows you to operate as a kind of financial mission control: the trusted brand that customers turn to when they need to access other financial services.

Benefits of earning the customer’s direct deposit

Earning the customer’s direct deposit can have additional growth-driving benefits, including:

  • Higher customer lifetime value: When you become mission control for your customers, you build a customer relationship that lasts years. The benefit of becoming the trusted brand for your customers’ financial needs, is that they build depth of engagement over time across various services, which builds loyalty, reduces the risk of churn, and increases lifetime value. 

  • Increased opportunities to cross-sell: When you’ve proven your value over time, your customers turn to you for support during life’s most important financial moments, from mortgages to student loans to planning for retirement.

  • Lower lending risk: Once you earn your customer’s direct deposit, you can get a more holistic view into how much they earn each month. This helps you understand their income predictability and empowers you to offer more relevant services, like payday and cash advance, at lower risk to your portfolio.

Three methods for authorizing direct deposit changes

There are three ways to authorize direct deposit switches: manually via paper forms, digitally via the payroll provider (manually), and digitally via the payroll provider (automated).

Manually via paper forms 


Filling out a direct deposit authorization form can be a straightforward way for customers to switch their deposits. 

  • It can be cost-effective for community banks or credit unions that can’t dedicate resources to build an entire digital flow.

  • Paper forms work well for clients who aren’t comfortable with online formats.

  • Customers can work directly with staff to address questions or concerns in real-time, while building a relationship with their institution.


Using paper forms isn’t without its challenges; to wit, the process is full of friction.

  • Handling sensitive information like account numbers is a security risk and often requires an additional step of using a voided check.

  • For busy customers, it can be inconvenient to find out who is the correct person (and where the payroll team is located) at their employer in order to submit their form.

  • As younger, more digitally native generations become a part of the core customer segment, this approach will also be less appealing.

  • Paper forms simply aren't an option for many online banks and services, which are designed to function entirely without branches or ATMs.

Digitally via payroll provider (manual)


Many payroll providers offer digital authorization methods. With this method, the customer must identify their bank account number and bank’s routing number. Then, the customer visits their payroll website to change their direct deposit settings with their account information on hand.

  • Compared with filling out a paper authorization form, completing a digital flow can be lower friction.

  • Customers can complete these steps at their own convenience.

  • The process of handling sensitive information like bank account numbers digitally can be more secure. 


However, digital experiences can still be complicated. 

  • Customers must find a paper check to identify their routing and account numbers, find their account information within their bank’s website, and/or contact their bank directly to get help. Then, they must accurately type and submit their information. 

  • The customer needs to find out if their switch is eligible online. If not, the customer must find a way to authorize the switch with a paper form.

Digitally via payroll provider (automated)


Finally, many financial institutions offer a digital authorization experience that automatically inputs the customer’s account and routing numbers into their payroll provider. Customers still need to login to their payroll provider, but they no longer need to identify or handle their account information.

  • This is often the most direct method of authorizing changes to a direct deposit.

  • The process is quicker and more seamless; the switch can happen in seconds.


The process isn’t without its complications.

  • The customer still needs to identify their payroll provider and then login to the provider to begin the automated authorization.

  • Not all providers or financial institutions are set up to complete automated digital switches. Customers may need to contact their employer and provider to find out if a digital switch is possible. 

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Common mistakes in earning the customer’s direct deposit

Financial institutions set on onboarding new customers may fall into the following common pitfalls:

  • Pushing for a direct deposit too early in the customer’s journey with the bank: For many customers, committing to a new primary account relationship is a big step. Asking them to switch banks before they’ve built trust with their new bank can trigger customers to feel uncertain and unwilling to move forward.

  • Not helping a customer understand what options are available: Today’s workers earn money in many different ways; not everyone gets a direct deposit. Consultants, freelancers, and other non-traditional workers might collect cash, checks, and invoices, or earn income on a gig platform. By pushing all users through a “direct deposit” set up, non-traditional workers may get confused and stuck in the onboarding flow. 

  • Not explaining the direct deposit switch process and timelines: Many customers expect the switch to involve a paper form and that they’ll need to speak to their employer and payroll team. They’re often worried about making mistakes and missing bill payments. It’s important for financial institutions to set customers’ minds at ease by clearly explaining the steps they’ll be taking, and letting them know when to expect the changes to take effect. 

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Best practices for motivating customers to change direct deposits

Consumers are increasingly open to trying new accounts and services that can improve their financial health. From working with financial services across the ecosystem, these are the best practices we’ve identified that influence customers to switch their direct deposit.

Eliminate friction

Switching direct deposits is a high-friction process; whenever possible, automate. Removing or expediting steps can increase the likelihood that a customer successfully completes switching to a new account. Instead of requiring customers to remember their account and routing numbers, can you allow them to log into their bank with their username and password? Or perhaps even enable credential-less login? Rather than contacting their payroll provider to find out whether they can switch digitally, can you empower them to search through a list of covered providers and employers?

Communicate the benefits

Customers become emotionally attached to their first institution. On average, people change their primary financial account every 14 years. People generally set up their first account with a parent, and it’s often this account that takes them through life’s biggest moments: college, their first job, getting married, and starting a family. The psychological bond to the first account is hard to break, and customers are more likely to add new accounts instead of switching over entirely to a new institution. 

Changing direct deposits (or primary accounts) is not an ingrained financial habit for most people yet. To overcome that barrier, share with your customers why switching direct deposits may be good for them. Perhaps it would allow them to get a more holistic view of their finances and spending habits. Or maybe it could help them qualify for better credit cards and increased lines of credit. Take advantage of the digital communication tools you have available: use email campaigns, build a dedicated landing page, and leverage push notifications in your app.

Build trust

Earning customer trust is a delicate process. Even with clear financial benefits and incentives, customers ultimately must feel confident that their new financial institution is trustworthy. Will their new bank have their back in case of fraud?

Build trust first, then ask for the direct deposit. Create an onboarding experience that helps users understand your service and experience its benefits first, and then add touch points that invite them to make the switch later in their journey. 

It may be tempting to prompt users to switch their direct deposits when they initially set up their accounts. In testing Plaid has done with focus groups, we’ve learned that users need time to familiarize themselves with their new service. As they become more comfortable and confident in your service, switching deposits becomes a natural next step in the customer relationship. 

Provide incentives

Given the difficulties of switching, psychological ties, and the hassle of updating recurring payments afterwards, customers must overcome their own internal resistance to be convinced to change accounts. It takes considerable time and research to understand the new account’s services and validate the financial institution’s trustworthiness. And, after the decision to switch has been made, customers must adapt new habits to fully integrate the account into their financial lives. 

Leverage incentives to build motivation. We’ve found that people go with what they know—until a great deal comes along. While customers are reluctant to leave primary accounts, they’re willing to go through the trouble when great financial incentives are available. This could mean a far better APY than what they’re already getting, access to faster loan approvals, or a one-time $200 cash bonus. Don’t forget the qualitative benefits, like 24/7 instant customer support and a smoother digital experience, that can save your customers considerable time and headaches. 

The opportunity ahead: Defining the future of finance

Consumer priorities have changed. Gone are the days of sticking to one financial institution for life: From personal finance to investing, today’s consumers are turning to multiple new tools to manage their financial lives. The increased competition is squeezing bank margins, with lost revenue, lower valuations, and churned customers at stake for incumbents.

In this new financial world, the financial platform that becomes the primary account, through which all incoming direct deposits and outgoing financial activities flow, has the potential to retain loyal customers, regardless of the new financial tools they may adopt later. With a holistic view into a customer’s finances, these institutions can also become key players to offer better and more customized products.

It all starts with earning the customer’s direct deposit. Smart financial institutions that can make authorizing a direct deposit switch swift, seamless, and convenient stand to benefit, not only in customer growth, but in the possibility of defining the financial services of tomorrow.

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