Compliance is a core tenet of financial services organizations’ day-to-day operations. And the stakes are high, as regulatory fines are steep and climbing. Know Your Customer (KYC) compliance is just a piece of the overall compliance puzzle—but it’s an important piece. In 2022, global fines for failing to prevent money laundering and other financial crime surged more than 50% according to the Financial Times.
KYC processes are often a thorn in the side of financial institutions, as the data they need is difficult to find within highly complex, manual workflows that are made even more complicated by outdated technology. Discover how process automation can help you overcome these challenges.
Financial institutions must comply with regulatory mandates imposed by government bodies and organizations such as FATCA, FCPA, and FINRA. On top of that, there’s also internal pressure to establish a unified view of customers, so decision makers can quickly view risk profiles, regulatory information, and performance data through a single lens of Customer Lifecycle Management (CLM).
Creating a comprehensive customer view empowers banks to make informed decisions, manage risk efficiently, and enhance compliance. Here are six top pain points that can hamper institutional efforts to ensure compliance:
- Siloed data: Siloed data that is not readily accessible to all teams prolongs onboarding and causes frustration for employees and customers alike.
- Balancing risk and improving auditability: Financial institutions need an efficient way to assess customer information and make informed decisions to avoid unnecessary risks.
- Relevance of information: Financial organizations often find themselves sifting through mounds of irrelevant information to get to what they need.
- Fragmented processes: Inefficient processes take longer than they need to, diverting time and energy from value-driven tasks.
- Manual tasks: Manual tasks make the KYC and customer onboarding process longer than necessary, taking time away from other business-building activities, like prospecting and servicing customers.
- Evolving regulations: Keeping pace with evolving regulations happens in parallel with abiding by corporate policies. Adapting to these changes requires flexibility, which legacy technology doesn’t always allow.
The complexities of these challenges can impede a financial institution's onboarding and customer processes, as well as hinder employee productivity. Additionally, they can restrict growth opportunities and escalate the risk of substantial compliance penalties. Appian partner RSM US LLP, an audit, tax, and consulting firm, suggests that this may be the reason why enhancing customer experience is the top priority for 48% of organizations as part of their growth strategy.
6 KYC Pain Points Solved: How to Drive Efficient Compliance
There is a way to take complexity out of KYC processes: the Appian Connected KYC solution continuously monitors alerts and automatically initiates targeted KYC investigations. Tailored to meet the KYC requirements of financial institutions, Connected KYC uses our process automation platform to tackle all six previously mentioned pain points. Let's take a look at how it works:
- Siloed data → data fabric. Legacy systems that aren’t built to be open limit data availability across systems. Low-code solutions bring data within disparate legacy systems into one place with prebuilt connectors and integrations that pull data into a single view, so it’s easy to make data-based decisions.
- Lack of auditability → easily accessed documentation. Having a holistic view of customer information is critical, and it’s exactly what financial institutions get with our solution or platform. Customer data and workflow history are available so teams can make informed decisions to better manage risk levels and grow the business with ease.
- Irrelevant information → mission-critical data at the forefront. Low-code solutions bring the most pertinent information to the fingertips of your operations teams, so not only are they more informed, but decision-making time is cut down dramatically.
- Fragmented processes → seamless workflows. Time is wasted when tasks require toggling between systems and sourcing inaccessible data. Connected KYC brings data and systems together, making it easier and faster to check off a to-do and get to the next one.
- Manual tasks → automated tasks. Without a seamless low-code platform, staff is left to sift through documents and keep processes moving with no assistance. This slows down workflows and increases risk of human error. The Connected KYC solution is powered by our powerful low-code platform with native automation functionality that drives mundane, repetitive processes forward without human intervention.
- Evolving regulations → agility and flexibility. As regulations continue to tighten and more is expected of financial institutions, agility is critical. Low-code allows financial organizations to adapt to change as needed, quickly, and with minimal disruption.
Both the Appian platform and our Connected KYC solution offers financial institutions a way to future-proof their KYC operations and transform their existing workflows. Want to learn more about how we help financial organizations better manage KYC compliance? Download our eBook Seamless Know Your Customer (KYC) Operations with Process Automation for a step-by-step guide to go from disjointed operations to efficient compliance.
