Fenergo’s recent webinar, ‘KYC, AML, & Onboarding in 2023 – Were Lessons Learned or Do Old Habits Die Hard?’, brought together compliance experts to delve into findings from research on over 1100 executives from global banks. This study, encapsulated in the report ‘KYC in 2023’, reveals a significant 17% rise in the average cost of KYC (Know Your Customer) reviews, accompanied by an 11-day increase in their duration over the past year.
Approximately two-thirds of banks now spend between $2,500 and $3,500 per KYC review. This escalating expense is attributed to various factors, such as the growing complexity of regulations, involvement of multiple jurisdictions with diverse requirements, and delayed client responses. Furthermore, efficient access to reliable data, notably better in regions like the Nordics compared to others with stringent data privacy laws, plays a crucial role in enhancing the KYC process.
The webinar highlighted significant issues in transaction monitoring at banks, particularly high false positive rates. These are often caused by outdated legacy systems and a lack of integration between KYC, onboarding, and transaction monitoring systems, leading to inefficient and isolated processes. The 2023 survey data indicates these are among the top transaction monitoring challenges faced by banks.
While discussing artificial intelligence (AI) and machine learning (ML) in transaction monitoring, it was noted that about a quarter of webinar attendees use these technologies for rules and analytics. However, over 46% do not utilize AI or ML at all. The panelists expressed optimism about the potential of AI and ML to improve transaction monitoring through more configurable rules and adapting to geopolitical changes.
Client experience emerged as a crucial theme, with nearly half of the banks surveyed admitting to losing clients due to slow onboarding processes. Enhancements like centralized client data storage, digital channels, self-service options, and a single point of contact were suggested. Nicola Poole, Global Head of New Client Onboarding at Citibank, emphasized the importance of a unified client view and streamlined service organization for reducing client attrition rates during onboarding.
Watch the webinar here.
Keep up with all the latest FinTech news here
Copyright © 2023 FinTech Global
Copyright © 2018 RegTech Analyst
