Join the Community

21,959
Expert opinions
44,065
Total members
413
New members (last 30 days)
154
New opinions (last 30 days)
28,667
Total comments

Would you ask someone else if they Know Your Client?

With eye watering fines and the threat of deferred prosecutions, many banks have been working hard to solve the problems of correctly identifying and screening clients for financial crime purposes over the last few years. As they have done so, it is clear that a number of parts of this process are common across banks and so potentially could be provided on a centralised basis.

This has prompted a growing number of providers to offer Know Your Client (KYC) services in this space:

The challenges of KYC differ significantly between entity/company customers and individuals with more public domain being readily available for entities than for individuals. This is why most providers are concentrating their efforts on the simpler problem of KYC for companies - although in most big banks the greater benefit would be through solving the problem for individuals. Also, regulators in some countries are much less likely to allow data on individuals to be shared outside their countries. So, it is not surprising that the States of Guernsey are looking at providing a solution for its high net worth customers, and being based in Switzerland may be an advantage for KYC Exchange. Also there is the issue that the information available to and from these third party operations is only part of the overall solution - there is still a significant part for each bank that is institution specific.

So overall some interesting innovation to help reduce a difficult problem even if it can only be a partial solution to a bigger problem.

 

External

This content is provided by an external author without editing by Finextra. It expresses the views and opinions of the author.

Join the Community

21,959
Expert opinions
44,065
Total members
413
New members (last 30 days)
154
New opinions (last 30 days)
28,667
Total comments

Trending

Karla Booe

Karla Booe Chief Compliance Officer at Zeta Services Inc.

Decoding the US Regulatory Landscape for AI Adoption in Banking

Kyrylo Reitor

Kyrylo Reitor Chief Marketing Officer at International Fintech Business

Future of SPI in Poland

Now Hiring