‍TL;DR: Merchant onboarding is slow, costly, and prone to errors, with unstructured documents creating a persistent bottleneck. Operational AI is finally solving this challenge by turning complex data streams into actionable decisions—accelerating KYB/KYC, strengthening compliance, and reducing drop-offs. OnBoard AIQ™ is a production-ready example of this shift, helping providers onboard faster, safer, and at scale.

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Beyond the Hype

For leaders in payments, the promise of artificial intelligence has often felt far removed from the pressure of daily merchant onboarding. 

Billions have been poured into so-called AI tools that look impressive in demos but deliver almost nothing when it comes to real onboarding outcomes. Chatbots, auto summarizers and polished dashboards have not reduced manual reviews, cut costs or stopped merchants from abandoning long and confusing flows. Many providers feel worn down by the noise and are tired of waiting for AI that never delivers anything real.

The gap between glossy AI narratives and the reality of merchant onboarding has never been wider. Providers hear promises of intelligent automation, yet their teams still work through slow, manual, document heavy processes that often lead to frustrated applicants walking away. Many providers are exhausted by slogans that promise intelligence but deliver little operational impact.

Rules based automation has often been rebranded as AI, leading to bold claims without meaningful operational improvement. Leaders hear promises of automation while their teams continue to handle documents by hand, chase corrections and battle through repetitive tasks that drain time, patience and morale. This disconnect exists for a simple, structural reason. 

Our industry has masterfully automated the flow of structured data through APIs, creating the digital backbone of modern finance. Yet this proficiency hits a wall the moment a document enters the chat. Business registrations, licenses, proof of address and financial statements still need people to read and interpret them. These manual steps slow momentum, frustrate merchants and create rising drop offs at the very point when engagement should accelerate. We built highways for data, but the final mile—the complex, unstructured world of documents—is still an obstacle course, requiring constant effort and attention to make it through.

As Daniel Sheahan, CEO of MVSI, observes, many solutions marketed as AI simply "sound clever, but in reality, they don’t move the needle. They can’t change workflows, make decisions, or take action."

Against this backdrop of inaction, a consequential shift is taking hold. Operational AI is moving decisively from analysis to execution, finally tackling the industry’s most persistent bottleneck: documents. By transforming them from a source of constant friction into a competitive advantage, it addresses the very challenges that have long plagued onboarding, from application attrition to skyrocketing operational costs.

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The Document Bottleneck

For years, the industry’s reliance on manual document handling has created a cascade of operational and commercial challenges that hit the bottom line hard, and the most immediate effect is costly merchant attrition. 

In a commercial environment conditioned by the immediacy of the 'Amazon experience', even the smallest delay feels unbearable for merchants who expect everything to move instantly. An onboarding process that drags into days or weeks does more than test their patience. It creates frustration, doubt and a sense that the provider simply cannot keep up. Research shows abandonment rates can reach 60%, representing a direct and costly leakage of hard-won acquisition investment—and future revenue. This is what we call “losing the will to live," as Sheahan explains, "A typical organisation incurs the entire cost of sale, only to see the client enter an onboarding journey that becomes an absolute mission to get through.”

Beyond the direct revenue lost to attrition, the financial impact extends further. The single largest operational cost in onboarding is typically the human labour required for document review. These tasks are slow, repetitive and mentally draining, and they force teams to spend hours on work that delivers little value. As application volumes rise, the workload escalates just as fast, pushing teams to their limits and reducing profitability with every new merchant added to the funnel. 

Manual processes also bring variability. Different analysts may interpret the same document in different ways, introducing compliance risk and creating an unreliable audit trail. In cross border onboarding the strain intensifies. Teams must validate foreign documents, navigate unfamiliar formats and check international registries and sanctions lists, often taking days to complete tasks that merchants expected to happen instantly. Every delay increases risk, slows activation and adds to the growing fatigue felt across onboarding and compliance teams. 

The core issue, therefore, isn’t compliance itself—it’s the inefficient, document-centric processes that underpin it. With this bottleneck clearly defined, the question becomes: how do you move from slow, manual interpretation to fast, actionable execution where documents stop being bottlenecks and become data streams?

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From Interpretation to Execution

Operational AI now addresses this gap with technology that can analyze, interpret and act on information in real time. The industry has spent years surrounded by passive tools that only point out problems without resolving them. Dashboards that flag risks and chatbots that explain policies have offered information, not action. This new wave of AI is different. It is designed to act. It analyzes, decides and executes, functioning as a real member of the onboarding workflow rather than a feature sitting on the side.

This is where OnBoard AIQ™ provides a clear proof point of what real, production ready AI looks like in practice. It is fully integrated into the OnBoard platform, allowing it to automate tasks that once demanded hours of human effort, including proof of address checks, beneficial ownership verification, document validation and risk scoring. This enables faster KYB and KYC, dynamic risk routing and cross border onboarding at scale, all while reducing manual workload and improving accuracy. 

As Sheahan explains, “OnBoard AIQ™ can examine a partnership agreement in real time, identify the controlling partners, and initiate the next step immediately.” This level of automation removes hours of manual review and creates immediate momentum for the application. The same operational intelligence applies to simpler tasks as well. Proof-of-address validation, for example, which once required checking document type, confirming the applicant’s name and address, and verifying the issue date, can now be executed in a single, fluid operation.

This efficiency is especially critical in cross-border onboarding, where unravelling international ownership structures is both paramount and notoriously time-consuming. Yet the true differentiator is its ability to move beyond interpretation to direct execution. After analysis, the system can autonomously enact the corresponding business outcome: approve a verification step, reject a document with a request for clarification, or re-route the application to a specialized workflow. 

This is what systematically dismantles the bottleneck, transforming a static document into a dynamic data stream that propels the application forward. In a practical sense, it means a foreign business registration can be verified and approved against global registries—without a human ever needing to navigate foreign portals or struggle with translation.

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Redefining Onboarding Economics

Integrating this level of operational AI is a strategic business decision, not merely an IT project, as it yields measurable outcomes that resonate in the boardroom. The most immediate shift is the acceleration of time to revenue. When onboarding moves from days or weeks to hours, merchants stay engaged, drop offs fall and value is realised much sooner. Faster approvals give merchants confidence and reduce the frustration that leads to abandoned applications. It makes the "Amazon experience" a commercial reality: apply for a merchant account today and have it fully operational tomorrow.

Concurrently, automating the manual review of documents directly attacks the largest operational cost in the process. Instead of scaling headcount in line with application volume, providers can finally break the cycle of hiring more staff just to keep up. They can handle far more merchants without overloading their teams, cutting the cost per merchant and protecting margins in a way manual operations never could. The consistency of AI-driven verification also delivers a stronger compliance posture. By providing evidence-based, auditable decisions on every document, it reduces human error and reinforces standing with regulators.

Together, these outcomes create a meaningful and defensible competitive advantage. In an increasingly crowded market, the ability to offer a seamless, swift, and secure onboarding journey is a powerful market differentiator. This advantage is compounded for providers operating across borders, who can leverage the technology to onboard international merchants with the same efficiency and confidence as domestic.

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Building on a Foundation of Automation

With the document bottleneck now being solved by production-ready technology, teams can logically focus on the next wave of applications. One emerging development is predictive orchestration, where workflows adapt in real time to applicant behaviour and risk signals, guiding merchants through the fastest and safest path to approval.

Self-tuning compliance will follow, where systems continuously monitor regulatory changes across different jurisdictions and recommend timely adjustments to their own rule sets, significantly reducing the overhead and delay associated with maintaining compliance.

These outcomes are not theoretical. They are already defining who wins and who falls behind in this market. As Sheahan notes, “AI is the asteroid hitting the dinosaurs. Providers who do not modernize will go the same way.” The providers who embrace real operational AI will be the ones who onboard merchants the fastest, the safest and the smartest. They will activate more revenue, reduce more risk and deliver the experience merchants now expect.

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A Clear Strategic Choice

The era of AI as a marketing slogan is over. The next phase will be defined by providers who use practical AI to remove friction, strengthen compliance and onboard merchants at scale. AI is now moving into prediction, where onboarding workflows adjust in real time as behaviour and risk change. Compliance rules will tune themselves automatically as regulations shift, removing the slow manual work that once held teams back. Embedded copilots will support analysts through complex decisions, helping them work faster and with more confidence. MVSI is already building toward this future.

The choice for providers is straightforward: embrace practical AI and prepare for a world defined by dynamic workflows, adaptive compliance and intelligent support, or fall behind in a market that is moving forward quickly. 

As Daniel Sheahan puts it with characteristic clarity: “AI is the asteroid from the Cretaceous period that wiped out the dinosaurs. Providers who don't modernise will go the same way.”

The capability to avoid this outcome is no longer speculative. It’s operational, proven, and here.

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Industry Insight: A Conversation with The Payments Association

This topic was recently explored in depth when Daniel Sheahan, CEO of MVSI, was interviewed by The Payments Association. In the discussion, he explains why unstructured documents remain the last major barrier to automated onboarding and how practical AI is finally removing that constraint.

You can watch the full interview here:
https://thepaymentsassociation.org/article/interviews/ai-that-removes-the-last-barrier-to-automated-onboarding/

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About OnBoard by MVSI

OnBoard by MVSI changes the game. By uniting Smart Forms, real-time risk engines, automated underwriting, and continuous compliance, it removes friction at every stage. What once took days now happens in hours, giving PSPs and acquirers faster activations, lower cost, and stronger compliance, while giving merchants an experience that feels seamless and secure. 

OnBoard AIQ™ is the next evolution: it sits on top of this platform, bringing in operational AI to interpret complex documents, make risk decisions, and trigger actions autonomously.

If you’re ready to turn onboarding into a competitive advantage, request a demo to see how OnBoard AIQ™ accelerates revenue, strengthens compliance and improves the merchant experience.