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The Careful Balance Of Compliance And Customer Experience

13 November 2020

In breadth and depth, Anti-Money Laundering (AML) and Know Your Customer (KYC) continue to grow.

So too does the challenge of implementing processes that remain compliant and efficient, without compromising customer experience. Financial institutions that can embed KYC as part of a holistic customer journey will be the ones who meet this challenge. Here’s how to be one of them.

While organisations have become more adept in meeting their regulatory obligations, efforts to optimise this process typically focus on increased operational efficiency through greater automation. However, if implemented effectively, integrating KYC in the wider on-boarding journey can both reduce friction points in the customer on-boarding process and further aid straight-through processing.

When designing a KYC policy, firms must ensure they have an accurate view of their customer risk, remain compliant with ever-changing regulation, and, at the same time, not compromise on customer experience. Customers often undergo drawn-out on-boarding processes, a fact made worse by KYC being treated by many firms as a stand-alone section of the on-boarding journey.

The account opening and product or service purchase must be done fast and efficiently, with discerning customers favouring the most friction-free on-boarding process when it comes to joining an institution. The on-boarding process can also serve as a key trigger point for banks seeking to use straight-through-processing to manage customer lifecycles and associated best-practice. As such, organisations have an opportunity to drive both customer satisfaction and efficiency gains. Importantly, this also later frees compliance teams to concentrate on outlying, complex KYC cases.

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Digital ID & V

Completing an identity check on a new client is a fundamental first step in any new business relationship. The account opening and product or service purchase must be done fast and efficiently, with quick KYC on-boarding being crucial in shortening time to revenue. For these reasons, firms must invest in technology and processes that bolster both compliance and customer satisfaction. By using digital solutions to verify biometrics, identity documents and proof of life, firms can gain confidence that they are compliant with their KYC obligations in a fast, secure way which no longer involves slow and cumbersome collection of documents. Likewise, customers are made aware within moments of the status of their application.

Digital ID & V serves to initiate both the KYC process and the overall customer on-boarding journey. The same digital check can simultaneously trigger a KYC risk screening and collect personal data about the customer for ongoing lifecycle management. For simple cases (individuals, sole trader companies etc.) this data can be enough for near-instantaneous, straight-through-processing of on-boarding, decreasing time to revenue for the organisation and creating a smooth experience.


Fast, accurate collection of customer data is a huge asset when performing KYC on corporate entities with complex ownership structures. With Ultimate Beneficial Owner (UBO) structures now being collated in seconds by Artificial Intelligence (A.I.) tooling, having a customer verification system that matches these efficiency savings is crucial for fast on-boarding of business clients. Whilst digital Identification and Verification (ID&V) initially predominantly served the on-boarding of individual customers, its importance for corporate clients is therefore critical. The more data that compliance teams have at an early stage, the better.

What to Consider


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Compile as much data early in the process, whether that is from the customer themselves (using Digital ID&V tooling) or from their business, for example with existing documentation from earlier on-boardings.


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Utilising additional data sources allows you to build a broader, and therefore more accurate risk assessment when performing KYC.


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Automating the on-boarding process with increased straight-through-processing is not only quicker initially – it greatly reduces inconsistencies that would need to be addressed later.


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Digital ID&V checks can be conducted consistently throughout the customer’s entire lifecycle. With an automated on-boarding process, KYC obligations can be met and future screenings scheduled with little or no involvement from compliance specialists unless absolutely necessary.

By no longer treating KYC as a separate process, financial organisations benefit both themselves and their customers. Firms optimize both their 1st and 2nd-line operations (through better collection of data), with customers benefiting from less friction points throughout on-boarding and ongoing lifecycle management.

Customer Centric KYC

The careful balancing act of compliant and efficient KYC with positive customer experiences.

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