This article is part of Kyckr’s new Future of KYC Compliance series, which interviews leading industry professionals and thought leaders to learn more about the trends that will shape the future of KYC compliance.
The following is an interview we recently had with Joel Lange, Managing Director, Risk & Compliance Division at Acuris Global.
What’s the current state of KYC compliance?
It depends very much on the industry, but that in itself is a part of the current state in that so many new industries are doing some form of KYC. The state of KYC is always somewhat determined by the three legged stool of Data, Technology and People. With increased availability of data, developments in workflow, machine learning and artificial intelligence as well as intense scrutiny on human resources opportunities for optimisation are significant.
How has KYC compliance evolved over the past 5 years?
There has been a significant evolution of KYC techniques around Companies and People via both proprietary and vendor aggregation tools. For KYC on Companies, the ability to combine key risk triggers on Adverse Media, State Ownership, Financial Health and Registrar information has made the quick and initial assessment of firms easier and more rapid. Additionally for KYC on People, the combination of identification and verification solutions with traditional AML data and other high risk information allows for a very quick go and no go answer for firms doing rapid KYC.
How has KYC compliance changed in the midst of COVID?
As I’m sure other contributors will point out, the COVID crisis has accelerated trends already ongoing namely the digitisation of compliance workflows and the elimination or optimisations of archaic business processes. Even up until recently I am always surprised to learn about an organisation's process and the amount of paper, PDF’s and unstructured data that is part of building a KYC portfolio. All of this is getting optimised for the better.
What are the top trends shaping the future of KYC compliance?
As the wider umbrella of KYC becomes bigger and bigger I see more and more demand for specialised sector based solutions. A KYC solution for a big retail bank is not and should not be the same for a large gaming organisation or large corporate doing diligence on its global supply chain. This means KYC providers becoming more specialised to service the needs of sector specific customers, leveraging common technology and data, but aligning it to the needs of the sector they are serving.
What’s the future of KYC compliance?
There have been many utilitarian and community based initiatives over the last decade around KYC. Many have fallen flat, but some have succeeded. Where there is a willingness to share baseline services and create a global minimum for baseline KYC there has to be cost savings for communities. But that relies on communities realising these basic standards and commonalities. They are worth persevering for, not just to bring down cost but also to work together to fight financial crime.