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Personal Loan Form Analysis

Comparing the loan application forms of leading UK providers

Created by Al Mackin

Why I carried out this research

Applying for a personal loan is a time-consuming process.

It would take the average user two minutes and twenty-five seconds to complete the loan application form, with some providers taking up to five minutes and forty seconds.

The average loan provider requires the completion of thirty-three fields. For one provider the number of required fields is seventy-four. There's a big difference between the best (fastest, easiest) and the worst loan application forms, and in this research I explore which providers are high performers and what they're doing in order to achieve a higher form conversion rate.

The opportunity to improve application form conversion rates is real. Even the strongest providers in this research could improve performance. The results of even a minor uptick in conversion rates are significant

Loan application forms are long and consumers dislike long forms. This leads to:
Increased Application Cost Higher Abandonment Increased Marketing CPAs

Our Analysis

This research was created in August 2017. To ensure I judged each loan provider fairly I created a persona that I used across all the application forms. The personal information I entered was standardised.

In my research I only counted required fields, so optional fields were noted but not included in the results.

Finally, when an average is discussed in my research it is a median, unless otherwise stated.

  • I analysed 39 loan application forms

    My research included almost every major UK loan provider.

  • 52 metrics were used to measure performance

    I looked at every aspect of the form, from fields used, timings, and mobile usability.

  • I ranked each loan application form

    I scored each form based on the likelihood that a potential customer will convert.

Five Key Take-aways

Mobile keyboards are an opportunity. Nearly 50% of providers will see a conversion uplift by using mobile keyboards on their fields.

Inline validation on success and failure is underused. Three of the top six lenders use positive inline validation, but only one other lender uses inline validation. This should be on every form improvement to-do list.

Tell customers why you need personal information. Adding an explanation on a personal question (salary, telephone number) will increase the confidence a user has in you, and make them more likely to convert.

A third of loan application forms don’t use radio buttons. Considering how much faster radio buttons are compared to drop down fields, they should be more widely used. A move from drop downs to radio buttons been happening in the insurance sector.

Customers want to know they can contact you, even if they don't end up doing it. 56% of application forms don't have visible contact information (telephone number or live chat). Customers may never speak to you, but their confidence in you increases when they know they have the option.

Loan application forms vary significantly in length

Splitting a lengthy process into steps is a good way to chunk down a large number of questions into sections, making it easier for a customer to complete. The trade-off is that the more steps there are, then the greater likelihood that the user will perceive the process to be long, and perhaps too long for them to complete right now.

30% of providers have five steps or over. The potential customer will ask the question "When will this process ever end?". There's no rules or sensible data on the impact that the step number will have on conversion rates. The correct number of steps can only be found with testing and analysis. From my experience of forms there is a negative impact on form drop off rates if you have too many steps, and the process appears endless.

When I ranked all the loan providers only one company in the top ten had more than two steps, and across all the providers 46% had either one or two steps in their application process.

Comparing the top five and the bottom five ranking loan providers, there is a significant gulf in the average number of steps in the process. The top five sites have barely over 1 single step, with just one of the loan providers having two steps. For the bottom five the average number of steps is 5.2.

More fields mean lower conversion rates

There's a significant difference between the application form with the least fields, and the one with the most. Lendable asks the user to complete just twelve questions, while Smile asks for seventy-four. It's likely that Lendable will see a much higher conversion rate for their form.

The average number of fields across all providers is thirty-three. If you're below that then you're likely to outperform your competitors, whereas if you're over then you'll most likely see a worse performance. If you have double the number of fields compared to the average then you'll see a significant performance dip versus the market. This dip will be costing you applications, and money.

There are three ways to reduce the number of fields in a form. Firstly, are there optional fields that can be removed. Secondly, can the business process be changed to reduce the data required by the user. Finally, can you gather information on the user from information they have already entered, or at a later stage. An example of automatically gathering data is the use of an API, the most used example is postcode lookup but there are other APIs that can draw the users full name from just an email address.

It may seem trivial to remove a single field in a form that has twenty or thirty fields, but the impact is felt in two ways. Firstly, there's one less input element for potential customers to complete, reducing the time required and the potential that a user will abandon the process. Secondly the user will see a process, or part of a process, that visually appears shorter. This has an impact on whether the user will decide to start the process.

Some loan forms take three times as long to complete

Which form will have a higher conversion rate: One that takes 58 seconds, or one that takes 341 seconds? It's not a trick question, but it's certainly one that loan providers should consider. Lendable's form, with just twelve fields, takes 58.7 seconds to complete on average. Smile's form contains 74 required fields and takes almost six minutes to complete.

With the average form taking two minutes and twenty-five seconds to complete, and a direct correlation between time to complete and conversion rate, what can you do to reduce the time to complete for a form?

Removing optional, but unused fields is one way to reduce the time to complete. Changing your business process to ask less questions is another way, but there are further ways to reduce time to complete.

The type of field (i.e. text box, drop down, radio buttons) has an impact on the time that it takes a user to complete a form.

Text boxes, on average, take users the longest to complete, followed by drop downs, then radio buttons and finally check boxes.

Radio buttons take an average of 2.8 seconds to complete (from absorbing the question, to selecting the answer) compared to 3.6 seconds for drop downs.

Sliders fit somewhere between text boxes and radio buttons, as users often engage with them multiple times (changing the value of the slider) however they are, on average, faster for users than entering information in a text box.

Some fields are more prone to corrections (editing the information added to the field, and/or revisiting the field to correct the information). A good example of how to optimise field type to reduce corrections is the use of sliders, which makes it significantly easier to enter a loan amount. A user entering a loan amount in a text box may add a currency symbol at the start, which may cause validation issues. They may include a comma to represent thousands, which may also trip up validation. These issues are removed with a slider which makes sure that the choice of the user is in the format that the site wants, and in the range that the site can offer (for example within the upper and lower boundaries on the loan ammount).

Validating and gamifying will increase conversion rates

Almost 40% of loan providers have no inline validation, meaning that users are only told of errors at the end of the form. There is a significant opportunity to increase conversion rates by telling customers about issues as they move through the fields.

Inline validation is an effective way to highlight issues as a user moves through a form, and when you have a long form with complex questions it's a necessity. Showing errors whilst the user is engaging with a question is better than having the user click submit and then they're then presented with a list of all their mistakes.

Just over half of loan providers alert users to errors as they move from one field to the next. This is positive, but they're missing out on an opportunity. Just 10% of providers alert the user when they have made a mistake, and they inform the user when they have entered information correctly. This subtle difference in the form user experience can make a big difference to the confidence of the user as they move through a long application form.

Telling the user when they have correctly entered information, usually by adding a tick image next to the field, leads to a feeling that when they come to click submit it will be successful.

Validation - Gamifying Long Forms

Website visitors have all experienced frustrating forms. When they start to engage with yours they are carrying baggage from the times when a form has been annoying. The length of a loan application form suggests that it will be a painful process for them.

A good way to keep users motivated, and to challenge their belief that the experience will be painful, is to use positive validation as they enter data. This is often in the form of a tick box next to a field, and is shown as they exit the field and move to the next one. This positive validation keeps the user happy, and helps them believe that when they click the "submit" or "next" button that they will be successful.

Showing errors in-line is equally important, as the user doesn't have to wait until the end of the step to see if they have made mistakes. A good inline validation process will not only show the user if they have entered incorrect information in a field (and so so as they move out of the field) but it will also explain what they need to do to correct it.

Hitachi use full inline validation on their loan application form, showing messages or symbols to the user when information they have entered is correct and also showing the user when a mistake has been made. In addition they give a full explanation of what the mistake is.

In the video below you can see how they use positive inline validation.

video showing inline validation in use

Below you can see how Hitachi report errors to the user through inline symbols and messages. The error message changes based on the advice that they need to give the user to correct it.

video showing inline validation in use

Exposing Customer Service Contact Details Is Critical

Some customers may want to contact you directly during the application process, whilst others may just want to know that they have that option. Having visible contact details will help both groups of people, and those who just want to know that you're a reputable brand that's willing to share a phone number.

Only 43% of loan application forms have a visible phone number or contact details. Whilst reducing support costs is important, building trust is a critical factor in form completion. Sharing contact details is an important component in building trust in financial services.

The importance of Field Type in Loan forms

The field types used in a form can make a significant difference to the frustration that a user feels, and the time that they take to complete it. Long forms give a much greater opportunity to change field types and to test the results.

There are three field types that should be considered: radio buttons, drop downs and tick boxes. In certain scenarios, you can change the field type from one to another, with the aim of making it faster for the user to understand the question and all potential answers, and faster to select the right option.

Comparing the top five and the bottom five ranking loan providers, there is a much greater focus on text boxes by the highest scoring organisations. Whilst the higher ranking sites prefer text boxes, they have far fewer inputs than the bottom five. The top five sites have an average of 8.6 text boxes, compared to 26.2 by the bottom five.

Why Radio Buttons save time

Radio buttons trump Drop Downs for two reasons. Firstly all of the potential options are visible and readable by the user on a radio button. A drop down requires the user to click and then read the options.

Secondly the user has less total interaction with a radio button than a drop down, a drop down requires a minimum of two clicks versus the single click for a radio. With a form that has a significant number of fields then saving the user fractions of a second will add up to a good time saving, and a greater likelihood of conversion.

Engagement examples: radio vs drop down

From our aggregated timing data on forms (Formisimo tracks engagement with fields with millisecond accuracy) I can see that the time spent on a radio button (taken from the time of the interaction with the last field to the first engagement with the next field) is 2.8 seconds, whereas a drop down is 3.6 seconds.

Explanations Increase Confidence, Conversions

Forms on Financial Services sites ask personal questions - like your date of birth, employment status and your annual income. Users are cautious, and sometimes confused, about questions that are highly personal. In your day to day life of completing registration forms and checkout processes this information is rarely asked for, so it can stop a user in their tracks.

When your process requires this information then offering an explanation as to why you need it, and what you use it for, is an important optimisation.

There are diverse ways that you can explain to the user why you need this information from them. Showing text around a field is an effective way to make sure that your explanation is always visible, but using an inline popup (that displays the message on the current field, as the user moves into it) is a good way to make the message highly visible.

Just under half of all loan application forms contain no explanations on why certain information is required. Just under 8% of providers show a popup on some fields, and 43% either show information inline (next to the field).

Marking Required Fields Speeds Up User Engagement

Do you fill in optional fields on forms? Most users don't. They want to get through a process as quickly as possible. Of course they want to give you all the information to provide them with a loan, but they also don't want to waste time on questions that are superfluous.

Users have become accustomed to forms that contain required and optional fields. It's helpful for the customer if required fields are marked, even though all inputs are required. It clarifies to them which input elements they must complete, which means they don't have to think about whether a field needs to be completed or not.

56% of loan providers don't mark required fields in their application forms. A simple optimisation would be to test the marking of required fields, and then monitoring the form conversion rate and the time to complete the process.

Mobile Friendly Keyboards

It's likely that a signficant proportion, if not a majority, of visitors to your site are on a mobile device. Some may start the journey on mobile and convert on desktop, but others may want to go through your entire process on a mobile device. Some users may want to complete on mobile, but end up having to complete on desktop because of the user experience. The aim of a good form is to allow anyone with intent to complete it on whatever device they want, lest they exit the site with the intention of returning later, but never do.

The prevalence of mobile usage presents new user experience challenges. Beyond the way that a form is presented there's a second challenge of how the user enters data, and dealing with the complexity of data entry compared to entering information on a desktop.

The use of keyboard types on mobile devices makes it easier for potential customers to complete a form as it shows them the most relevant keyboard for the data input. As an example, a number or telephone number field should show just the number keypad, rather than the full keyboard. A field that asks for an email address can show a keyboard that makes the "@" symbol visible without having to press the shift key. Adding this functionality to a field is relatively easy, and it generally has a positive impact on conversion rates.

Around 50% of loan providers use a mobile keyboard type on appropriate fields. 54% show the "email" keyboard type, 56% use "telephone" keyboard type and 51% use the number keyboard type. If you're not using mobile keyboard types then this is a simple optimisation that will reduce corrections and the time to complete a field. This will have an impact on the field drop off rates.

Scoring All Loan Providers

To score each loan provider I generated a ranking out of 82, which considered the number of steps and fields (related to the median score for each) and scored forms based on the percentage they were above or below this. I also scored the forms based on the removal of unnecessary obstacles, and the mobile friendliness of each form based on the usage of mobile keyboard attributes. Having visible contact details (for customer support) was also part of the scoring process, and using inline validation boosted scores further.

The aim of our scoring was to take into account attributes of the form rather than the look and feel. Some forms were more attractive than others, but as design is subjective I chose not to apply any marks for forms that I felt looked better or worse.

See a full league table of loan providers with deeper scoring data and read about the methodology behind my scoring by entering your details:

league table of loan provider application forms

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