The challenge: Manual processes drag out new customer onboarding to four weeks
This FinTech client offers a range of international payment services such as foreign exchange, forward contracts and options to personal and business customers.
The company had disjointed, manual processes for Know Your Customer (KYC) and Anti Money Laundering (AML) activities. To onboard new corporate accounts, relationship managers would collect the documentation from their prospective customer, and then email it all to the compliance operations team. The compliance ops team would then had multiple checks to carry out: document verification; checks for politically exposed persons, adverse media, sanctions, and counter-terrorism; a customer risk assessment; ultimate beneficial owner verification; financial checks; and lastly a final Know Your Business (KYB) status assessment.
The compliance ops team followed strict, rules-based standard operating procedures, and after initial checks, everything needed to be reviewed by a compliance manager. As a result, there was a lot of back and forth by email regarding the documents provided. All this dragged the process out, so it could take 20 days to onboard a new corporate customer. This meant:
- Higher costs from all the manual activities
- Risk of losing customers to competitors who could onboard more quickly
- No visibility of the process or operational KPIs
- Frustrated salespeople
For AML, the main challenge was the high number of false positives, all of which needed costly manual investigation.
The solution: Consultancy project recommending deployment of an onboarding platform
The client engaged Firstsource in a consultancy project to speed up customer onboarding and reduce the costs of KYC and AML. The project began with a discovery phase involving stakeholder interviews, client workshops and side-by-side observations to identify key pain points, cost drivers, inefficient processes, and manual tasks.
This was followed by development of a target operating model (TOM) and design of to-be processes, covering:
- Deployment of a customer onboarding platform, with API integration to the client’s CRM and third-party data sources such as Companies House and LexisNexis
- Implementation of Intelligent Automation
- Automation of 11 compliance activities across four processes: New Customer KYC, Payments Screening, Sanctions Monitoring, Customer Due Diligence & Risk Rating
To initiate onboarding in the to-be state, relationship managers will upload all customer documents to the onboarding platform. Automation and machine learning (ML) technologies then carry out an initial set of document checks and flag gaps or discrepancies within three minutes. The platform will also manage all subsequent compliance with built-in case management workflow. The Intelligent Automation and ML engines will also handle investigation of AML false-positives.
The result: Targeting $1.5M cost savings and a four-day onboarding time
The business case for the new onboarding platform targets the following results:
- Cut new customer onboarding time from 24 days down to four, an 83% drop
- Faster and cheaper resolution of AML false-positives
- $1.5M cost savings a year, approximately 25%
- Full visibility of KYC/AML processes with a complete set of KPIs and metrics
