Encompass: How banks can use technology to stay competitive

FinTech Magazine speaks to Wayne Johnson, CEO and Co-founder of Encompass, on the efforts legacy banks are making to keep pace with digitalisaton

We speak to Encompass CEO and Co-founder Wayne Johnson on what banks to do to remain compliant while meeting consumers’ increasingly digitalised needs, and how technology can be leveraged to build better trust between a bank and its consumers.

How can banks remain compliant and meet customer expectations?  

Banks are operating within an increasingly complex regulatory landscape, with the threat of fines and reputational damage ever-present if they are found to be non-compliant. At the same time, customers increasingly expect seamless digital journeys when engaging with their bank. 

Right now, the regulatory requirement to perform Know Your Customer (KYC) is a blocker in offering the experience customers are demanding. KYC is complex, especially when it comes to companies, and this is a challenge for banks. Getting the information that they need to fulfil regulatory requirements can take an extremely long time – with recent statistics showing some businesses are waiting as long as 12 weeks.  

The good news is that technology exists, in the form of digital KYC profiles, to provide robust compliance and enable seamless customer journeys. 

Digital KYC profiles are generated automatically and on-demand from authoritative public and premium data sources. They are ready to integrate into internal systems like CLMs and CRMs and provide a consistent view of that customer. This maximises efficiencies and resources, dramatically improves the customer experience and therefore makes banks more successful. 

At the same time, a technology-led approach ensures a consistent approach to compliance every time. With real-time dynamically generated digital KYC profiles, complete with source documents, data attribute lineage and a full audit trail, a bank can have full confidence that policies have been followed to the letter, activity is compliant and crucially, documented to show this. 

How are banks leveraging technology and KYC profiles to build customer trust and improve customer experience?  

Legacy technology and a lack of operability between systems have created what’s known as a ‘swivel chair’ effect. Accessing different sources of information, re-keying information and dealing with data conflicts takes time and leads to friction and risk in processes. This is bad for customers and bad for banks. 

Digital KYC profiles integrate with any existing technology, driving interoperability and eliminating cumbersome manual processes.  

Taking onboarding as an example, outdated, manual KYC processes often lead to lengthy onboarding times, which can cause friction, and not deliver in the way that is going to build customer satisfaction and resulting loyalty. 

Inefficient data collection can also act as a barrier, with manual processes involving numerous outreach requests to the customer for additional information - often information that has already been provided earlier in the process. Digital KYC profiles, generated on demand from multiple sources, means that outreach can be limited to only what is not publicly available, providing the most efficient and seamless journey for every customer. 

We are seeing banks saving days and even weeks on performing KYC on corporate customers. By prioritising customer experience, trust is built, and long-lasting relationships can be nurtured, impacting reputation and, ultimately, the bottom line. 

How does this allow banks to remain competitive?  

The reality is that banks today lose customers if they can’t onboard them fast enough. I know from my own experience that, as a business needing to trade, you will often select your banking provider based on how quickly they can get you up and running. 

Banks must now reconsider their systems and implement technology-powered processes that deliver – both for the customer, in terms of the fast, seamless, positive journey they demand, and for the bank by facilitating operational gains that result in growth and revenue impact. 

Digital KYC profiles enable fast and confident identity verification and validation for corporate customers, which is a real pain point for banks trying to ensure they are competitive. 

If a bank takes on the wrong customer, it opens itself up to fines, enforcement action and reputational damage. However, if it takes weeks to gather the information needed to make the right decision, you will also see valuable potential customers abandoning the process. 

As well as assured regulatory compliance, benefits of this enhanced insight also include improved customer trust, and consequently business reputation brought by evidenced robust KYC processes and accurate data, enhanced operational efficiency and the faster and simpler identification of business growth opportunities. 

How can automation technology help financial institutions to maximise the value of data? 

Performing KYC on an entity requires a mass of data. This amount of data is hard to monitor and maintain. Sources often come in different formats without integration in mind, resulting in fragmented data, which acts as a barrier to developing a single customer view. 

Digital KYC profiles bring together the data a bank relies on in one place, data in a way that makes real operational differences for banks. There’s no need for multiple integrations, and maintenance is handled by the vendor, reducing the burden on internal IT teams. 

As well as providing deeper customer insights, having accurate, complete and current data and documents in one place also helps to ensure a consistent process and policy adherence every time. 

By standardising the sourcing, retrieval and collation of data, crucially, a single view of a customer is built and maintained, allowing for a more effective KYC process overall.


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