The best defense? Know your customer compliance
October 2, 2018
In brief
In brief
- KYC is a priority, but keeping pace with constant AML compliance change has been tough for financial firms.
- Investing in cloud-based KYC and technology such as Machine Learning are among the vital steps included in our six-phase transformation process.
- Benefits of transforming KYC extend beyond lower costs and higher efficiency—including boosted productivity and greater customer satisfaction.
Anti-money laundering (AML) regulations are a moving target, with financial firms struggling—and spending time and money—to keep complying. Know Your Customer (KYC) processes, consequently, are a priority focus for senior managers, who would prefer a more cost-efficient approach.
Large financial institutions are routinely spending between $900 million and $1.3 billion per year on compliance-related ventures.*
The answer? Transforming the KYC function to maintain AML compliance, manage costs and deliver a more effective customer experience. Accenture’s report, "The Best Defense is Good Compliance: Know Your Customer Transformation," describes our six-phase transformation process that offers benefits beyond mere compliance.
Six steps to KYC transformation
Financial institutions working to transform their KYC function can divide their effort into six phases that ensure key challenges and risks are addressed.
Here are the six steps a firm can take:
Gain efficiency with data-driven process design
Review current-state KYC process metrics to identify areas for improvement that can guide the transformation.
Simplify the target operating model
Define roles and responsibilities, design processes and build a technology architecture to support the new model.
Boost reporting with quality and productivity
Embed proper reporting capabilities while reimagining metrics. Include dashboards for Key Performance Indicators and Service-Level Agreements.
Tap tech and data to streamline processes
Perform a data cleanup, then implement a Client Lifecycle Management approach to track workflow.
Move ahead of the curve via intelligent automation
Use new technologies such as Natural Language Processing and Machine Learning to automate highly manual processes.
Make your digital transformation client-centric
Create a client-centric, digital KYC form, with system-driven capabilities, that can function as a client self-service portal.
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Together, these steps can help institutions manage rising costs, regulatory compliance and customer experience. Among the keys to an effective transformation? Employing industry disruptors, such as Machine Learning, unstructured data analysis and cloud-based KYC tools to stretch a firm’s resources and open the door to new approaches.
After the transformation
When firms complete their KYC transformation, what can they expect? For starters, their operations should be more streamlined and technically sound.
But that’s just the beginning. Other benefits could include:
- More capacity to expand product offerings
- Higher customer satisfaction
- An enhanced, more trustworthy reputation
- Better honed insights into the firm’s own risk portfolio
Financial institutions embarking on this transformation process can go it alone, but Accenture can help. Our extensive experience can support firms from start to finish—or anywhere in between.
Why not seize this opportunity to take a challenging requirement and transform it—into not just a better way to comply, but a process that yields new business benefits? Contact Accenture and get your KYC transformation under way.
* "U.S., EU fines on banks' misconduct to top $400 billion by 2020: report," Reuters, September 27, 2017.
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