– Develop a Single Customer View

Customer data within banks is often held in distinct silos (external data, customer provided data, and transaction data) across multiple systems and business lines. Segregating data in this way can result in significant issues arising from data duplication and transcription, or translation errors. Breaking these silos to provide an aggregated representation, or single view of a customer can offer significant benefits.

A single view of a customer’s relationship with a bank across all business lines and products can enable the institution to respond rapidly to the changing needs of a client and drive efficiencies by ensuring that processes are conducted on a single profile. Providing a single source of the client’s data can also increase the speed of KYC and AML investigations and refresh activities. Ultimately a clean client data set can deliver considerable efficiency and improve the quality and speed of risk-based decision making.

– Create sophisticated digital customer journeys

Customer expectations are rising fast and this is no surprise given the ability to open a personal retail bank account in minutes with digital-first challenger organisations. The expectation for fast, slick digital onboarding processes has resulted in banks adopting new technology to significantly modernise and optimise their client onboarding processes – creating greater efficiencies and a superior customer experience. However, banks need to look at both the long-term vision and short-term wins when planning how to deliver these improved digital journeys. The approach must be joined up, addressing both the front-end customer experience and critically, the requirements of both the supporting operations and compliance functions.

– Introduce KYC automation

Automating KYC delivers significant benefits to banks. It can increase the speed of onboarding, reduce file touch times and ultimately reduce the time to revenue. Importantly it frees up time for teams to add value to the due diligence process rather than supporting the costly and admin heavy exercise of data gathering. Many organisations have already started their journey towards automation, focusing on identity verification, address validation and internal workflows, but there can be challenges encountered with this approach. We recently covered some of these issues and how to overcome them in this blog.

– Invest in a client lifecycle management (CLM) backbone

Creating a single workflow or “spine” for client onboarding and CLM processes can bring significant benefits, and this should be a priority for all organisations in 2021. Implementation may require replacing legacy technology, migrating to a single CLM system, or enhancing the current architecture. While these steps may be complex, they can represent a very effective investment. When done right, a holistic CLM system can support a single approach for managing every client event across all functions and lines of business, it can enable a single view of the customer, support the incorporation of 3rd party data, enable integration with other key internal systems or external providers, and ensure compliance to relevant regulations by region. However, it is critical that organisations invest in solutions which can be configured and adapted quickly and at low cost.

The pandemic has created an unprecedented challenge for banking risk management and KYC, with regulators warning that banks are more exposed than ever to financial crime. To mitigate this within onboarding, banks should:

– Move towards real-time Know Your Customer (KYC)

Real-time KYC enables banks to greatly reduce repetitive, manual work and save valuable time by removing a large population of clients from the periodic review process – effectively lowering the operational burden while improving risk monitoring. Most importantly, reducing the amount of time teams spend on basic KYC checks enables institutions to focus more effort on activities that add value.

– Evolve Financial Crime Compliance capabilities to meet future needs

The demands on financial crime compliance within client onboarding are greater than ever, with new threats evolving rapidly. Many financial organisations are starting to look at bringing separate AML, ABC, Fraud and Cyber teams closer together in order to drive a more joined-up view of FinCrime risk within the onboarding function.

By ensuring that the FCC and Operational functions have shared objectives and clear lines of communication, it is possible to generate a high performing, cross-functional team – one capable of maintaining the high pace and accuracy of decision making necessary to meet the needs of the business and to deliver against volume targets.