Don’t sleepwalk into a KYC arms race - Part 6: Customer is king

Our final blog, and the most important, in the series of why now is the time to opt out of the Know Your Customer (KYC) arms race.

When performing KYC, the customers’ experience should be at the forefront of the process. The less a customer has to do, the more chance you are likely to get a prompt and accurate response.

The problem is, the typical KYC process as we know it, is inefficient, time consuming and can often result in multiple back and forth requests to the customer. The KYC process and associated customer experience has become a key differentiator. If the KYC process becomes too much effort or as is often the case confusing for the customer they will take their business elsewhere.

We see the future of KYC as more customer centric, putting their interests and experience at the forefront of the KYC process:

  • Biometric technology - helps streamline the KYC process, particularly in retail banking, but hasn’t been used as much as it could be.
  • Robotic Process Automation (RPA) - exhaust technology to collect all publicly available data sources first, as opposed to bothering the client for easily obtainable information.
  • Customer interface - when outstanding information is required from the customer, as opposed to emails, use of a technology interface where the customer can see the documents required and can be uploaded quickly and safely.
  • Clarity of requests - the customer isn’t an expert in KYC, but often we see requests full of technical terminology, and a lot of waffle and a lack of clear explanations to what is required.

If the quality of customer interactions can be increased and the number decreased it will result in more useful information and a much happier customer.

The current KYC methodology that has evolved over the years and as a result of the KYC arms race, has become outdated. Requirements have grown exponentially making KYC expensive and ineffective. Don't sleepwalk into a KYC arms race. The time is has come to make KYC better, faster, cheaper but ultimately, more effective at preventing financial crime.

Missed the previous blogs about KYC? Catch-up on the series below:

Don’t sleepwalk into a KYC arms race

Don’t sleepwalk into a KYC arms race - Part 2: Time is money

Don’t sleepwalk into a KYC arms race - Part 3: Risk based approach

Don't sleepwalk into a KYC arms race - Part 4: Keep it simple

Don't sleepwalk into a KYC arms race - Part 5: Tick box exercise

Imran Farooqi | Partner
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