How to Replace Manual Client Onboarding with Automated KYC/KYB

Posted on September 5, 2022
Written by Clare Puplett

Automated KYC/KYB

There has been rapid digital growth over the last two years, accelerated by the global pandemic. Consumers’ expectations are now higher than ever, and their patience is reducing – they expect to sign-up or be onboarded instantaneously. They also value their privacy and demand high levels of data security. In this blog, we look at how businesses can meet the demands of customers by creating a better user experience and yet, still achieve compliance.

Efficient, ‘friction-free’ client onboarding is vital for any company to achieve growth. Delivering it within regulatory requirements is, of course, essential. The balance of speed and efficiency, versus accurate reporting and compliance is critical. 

Anti-Money Laundering (AML) regulations continue to get tighter, and the UK is one of the world leaders in introducing compliance initiatives to combat financial crime. Life for regulated entities is set to get tougher, particularly with the introduction of the Economic Crime Levy, which will only add further expense to the bottom line. 

The cost of delivering a robust compliance program can be high, particularly if a company is still onboarding their customers using manual processes as it demands substantial headcount. Manual review is not only a costly resource against the operational overheads but also negatively impacts the customer experience for the onboarding process.

Automated KYC/KYB Verification

Companies who have avoided introducing automated client onboarding, cite a combination of concerns. These include cost implications; integration with their legacy system/s; down-time and loss of data. This might have been the case historically but should no longer be a barrier. They are misconceptions that create apprehension and prevent businesses from achieving growth and delivering exceptional customer experiences. 

The truth is, integrating automated client onboarding software into your existing systems, however disparate, is not an issue. Software solutions are powered by clever API and AI technology to automate routine tasks that are a drain on many a compliance team.

Customers, whether individuals (KYC) or companies (KYB), are no longer prepared to wait days, or even weeks, for the onboarding verification to be completed. We live in a ‘deliver now and deliver once’ world. People expect instant responses to their applications and are no longer prepared to give their data multiple times, just to satisfy the protocols of a manual process.

The Importance of Adopting Automated KYC/KYB 

Automation doesn’t just apply to onboarding tasks. The technology can be used throughout the whole customer lifecycle and Customer Due Diligence process. To continue to comply with the demands of the regulators, regulated entities need to have ongoing monitoring in place. Data goes out of date very quickly – virtually overnight – so clean results can only be guaranteed if you have access to a solution that can provide real-time reporting.

Failure to comply, with the prospect of punitive fines from the regulator for failing in your AML obligations, has been enough to drive many a manual process. The burden of which is now so onerous for any manual system to manage.  

Recent events between Russia and Ukraine have shown the need to identify Ultimate Beneficial Owners (UBOs) of businesses. PEPs and Sanctions checks are essential for any company dealing with individuals or companies. Without automation providing easy updates and real-time monitoring, important data changes can easily be missed and allowed to remain undetected for many months. Any such breach would be frowned upon by the regulator and subsequent fines inevitable.

With the advent of the 6th Anti-Money Laundering Directive (6AMLD), companies, and their officers, can no longer hide behind the claim that “they didn’t know anything about it!”. The onus now is for businesses to be held accountable for ensuring compliance. So, for the authorities, it’s not just catching those committing a crime, but identifying anyone abetting or allowing the crime to happen, whether by design or ignorance of the act.

How Do I Introduce Automated Client KYC/KYB Onboarding?

The first question you should be asking yourself is – “What tasks do I want to automate?”

There will be tasks that are repetitive and time-consuming and can be delivered without human intervention. Automating these with a software platform such as NorthRow WorkStation will allow your team to free up their time to focus on the more complex cases.  

At NorthRow, we partner with all our customers and support them through the design and build phase of their instance of WorkStation. With a choice of over 600 ‘rules’ businesses can select a unique set of rules that are matched to their risk appetite. 

With a period of testing and access to any training, businesses can be up and running far quicker than they had imagined. Efficiency improvements are immediate, and the speed of onboarding is reduced to minutes rather than days, immediately. 

Deputy MLRO and Head of Customer Due Diligence, Knight Frank said, “…there has been a positive change towards client onboarding. We have seen a significant improvement from a cost and time perspective”. Read more of our client stories here.

Compliance Automation Tools

From an easy to deploy app to provide identity verification for ease of onboarding; KYB/KYC onboarding and monitoring for AML; through to intuitive dashboards to monitor cases in real-time and provide data insight and reporting, there is a range of automation tools available to businesses. 

Modern facial and audio recognition software, biometric and ‘liveness’ checking, as well as remote document verification techniques, lend themselves perfectly to the onboarding process, speeding it up and shaving the time down from weeks to days or even hours. All of which can be achieved with total confidence, and with an audit trail that fully satisfies the regulators.

Choosing Your Automated Onboarding Partner

Any automated process should be designed to address your specific and unique needs – it’s not about your needs fitting the software available!

NorthRow provides bespoke solutions to satisfy any company’s onboarding needs and AML requirements. Our RemoteVerify software speeds up onboarding and provides the reporting necessary to satisfy the regulators, making life simpler for compliance teams and allowing them to concentrate on in-depth queries that arise. 

NorthRow’s powerful single-API platform was designed to meet the challenges that companies face, when dealing with financial crime and the regulators’ requirements. We have a number of tools that can be used singly or in combination, using the latest technology: biometric facial recognition, voice verification, liveness video, lip-syncing and anti-spoofing techniques; and our RemoteVerify tool can seamlessly check multiple identity documents.

On the monitoring side, our tools interrogate multiple national and international databases and report to your compliance team on an “only cases relevant to you” basis, which saves time in trawling through lots of records that don’t apply to your customer base. 

Ultimately the time has never been better to explore how automation can help your business deliver better customer experiences and save on operational overheads. It really is easier than you think to deploy!

If you would like to discuss how automation can help your compliance team book a call to learn more.