Repairing eKYC, AML and the disjointed customer experience
There are five practical steps financial institutions (FIs) can take to lessen the friction between their fraud compliance and user experience teams.
Following these steps can help reduce interdepartmental friction, as well as the amount of friction imposed on customers during the onboarding process. These include:
- Nix the one-size-fits-all experience. Not all applicants are created equal. Some applicants for a given product are already customers which means you’ve already captured data about their identities and transaction histories. Other applicants may have found your website organically which means you have virtually no information about them. So, each user experience should reflect how much intel you have about the applicant.
- Integrate screening and identity proofing. Many FIs treat AML screening and identity verification as two distinct, mutually exclusive processes. But, financial institutions can leverage identity proofing to extract key fields from the ID document such as name, address, date of birth and the applicant’s picture, which can be used to check against PEPs and sanctions lists to help reduce the number of false positives. Fewer false positives translate to fewer cases, lower operational costs and a better user experience.
- Higher levels of identity assurance. Many FIs still rely on data-centric approaches for establishing an applicant’s digital identity and this can open the door to money laundering. Data-centric approaches involve checking the identity data (e.g., name, address, phone, date of birth) entered by a user against third-party sources, such as credit bureau data. Thanks to large-scale data breaches, social engineering and the dark web, much of that data has been compromised. Relying on stronger forms of identity assurance, including a picture of a government-issued ID, a corroborating selfie and liveness checks can keep bad actors out of your ecosystem.
- Automate, automate, automate. While technology has made it easy to access huge data volumes, it still can’t process data quickly or effectively enough. The problem of speed and accuracy impacts everyone in the chain — regulators, compliance teams, financial institutions and their end customers. While speed is necessary for customer onboarding and for detecting and reporting risk, it also leads to countless false positives that are impossible to check accurately, meaning criminals slip through the net.
- More vendors = more problems. Efficiency is lost using multiple solutions, both with respect to workforce and data. Data gathered during the onboarding process as part of the KYC and process should be leveraged going forward as part of the ongoing KYC program as well as for performing . For example, a customer’s risk rating, which is created during the onboarding process, can be influenced by how many transaction monitoring cases have been created in their name or how many SARs have been filed on them.
When your teams work together from the outset and focus on delivering a better customer journey, they can build smarter, more flexible processes that produce happier customers, reduced risk and more compliant procedures.
This article was contributed by Dean Nicolls, VP of Global Marketing, Jumio
Singapore FinTech Association launches new networking club
The Singapore FinTech Association (SFA) has announced the launch of a new SG FinTech Club, which will act as hub that enhances networking among local fintech companies based in Singapore.
The APAC nation, which is a leading regional centre for fintechs, accounting for 13% of Singapore’s GDP in 2020. More than 1,400 fintech companies are based there, employing an estimated 10,000 people.
Technology is a driving factor within the space, and the SG FinTech Club will act as a base through which knowledge, resources and connections can be shared, as a way to increase the level of expertise in the space.
According to reports, the SFA will also develop and curate the engagement programmes for the fintech ecosystem. SG FinTech Club members will benefit from hospitality privileges offered by Supporting Partners , such as co-working spaces, which they can leverage on for social engagements.
The club’s existing membership platform will also enable users to sign up for talent matchmaking sessions, industry expert mentorship programmes, and masterclasses organised by SFA.
SG Fintech Club partnerships
The initiative has attracted the attention of several global fintech leaders, including the Institute of Banking and Finance (IBF). J.P. Morgan has also joined the club as Supporting Partner and Corporate Partner, respectively, to develop skills and career development events.
Speaking about the launch of the new club, Shadab Taiyabi, President of SFA, explained, “We are proud to collaborate with MAS on the launch of SG FinTech Club, and play our part in contributing to Singapore’s thriving FinTech ecosystem.
“We hope that the Club would be the key platform for inspiration and innovation, where professionals in the financial services sector can come to exchange opinions, network, and explore endless ideas with other like-minded individuals.
He continued, “Through the Club, we strive to champion and bolster Singapore’s FinTech entrepreneurship growth, facilitate the sharing of insights, collaborations, discussions and advocate the importance of upskilling amongst professionals across the financial services industry.”
Image credit: Singapore FinTech Association event