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Digitalizing the Client Lifecycle: A Vision for the Future

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Greg Watson
Managing Director, Strategy & Sales

Greg goes beyond the hype and analyses how banks can capitalise on disruptive tech, including Blockchain/Distributed Ledger Technologies (DLT) and Artificial Intelligence (AI).

Recently, I spoke at the Global Client Onboarding and Data Management Event in New York. Much of the discussion during the conference was around new technologies, especially Blockchain/Distributed Ledger Technologies (DLT) and Artificial Intelligence (AI). In my own presentation, I pointed out that Client Lifecycle Management has been traditionally labour-intensive and that client outreach, in particular, has become unwieldy and cumbersome, seriously eroding client experience.

However, there is hope in the form of digitalization.

While there is no doubt a lot of hype surrounding disruptive technologies, enablers such as AI can automate the onboarding process by unlocking data either through the use of datahubs or the deployment of such technologies as Optical Character Recognition (OCR). Using those technologies, firms can gather and action insights from that data to support front office and sales efforts. In a similar way, blockchain has potential as an industry utility for gathering and sharing data throughout the lifecycle. However, it needs government and regulator support, as well as engagement by the banking community. For a truly better client experience, the interaction must be instant; proactive; automated; contextual; personalized; and intuitive. The industry has the means in place to create this environment. (Download the playback of a recent webinar we held on this very topic by clicking here.)

I also participated on a panel entitled, “KYC Challenges,” with Abdul Rahim Ahmad, Executive Director and Regional Head of Client Onboarding at Standard Chartered; Hadrian Tucker, Senior Compliance Officer at State Bank of India; and Mark Zilberzweig, Head of Compliance at CTBC Bank. In my opinion, the biggest challenge in KYC is the quest for sustainability. It is one thing to set up and execute the initial onboarding process but quite another to provide insight and allow for changes throughout the client’s entire relationship path. The process needs to be able to scale across the enterprise.

When it comes to data, banks should first codify the “rules of the game” by identifying key elements and the main areas of risk. A firm’s data governance requires a global approach, but it is also advisable to benchmark on a regional basis, providing insight on common elements. A firm’s data must be in shape for proper remediation, but it also comes down to staff. There is so much manual work in the current process that a firm should review processes and automate what they can now. A firm does not need a third-party consultant to come in to caution about the amount or degree of risk in manual processing; that first step can be undertaken almost immediately.

One of the main themes throughout the sessions and panels was the need for collaboration among the banking community to address onboarding compliance and KYC processes. It struck me that this is akin to Fenergo’s model: to foster collaboration and build consensus across our client community via our Regulatory Forums in establishing best practices for current and future compliance requirements. Collaboration also extends to the regulator/bank relationship. If a firm’s initial interaction with a regulator is when it’s being fined, it has zero leverage. Financial institutions need to engage proactively with the entire regulatory community.

Greg Watson

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