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Regulatory Compliance and Customer Centricity: Can Banks Address Both?

When it comes to client lifecycle management (CLM), including sales, onboarding, global KYC, credit through to fulfillment, offboarding and servicing, banks and their corporate clients agree: The experience has to improve. In a recent Finextra survey about corporate banking customer satisfaction, 90% of big corporate banking clients said they would consider switching to a different financial institution for better service around onboarding, account maintenance, service requests and inquiry handling.

Onboarding and customer service have become major pain points for global banks, impacting customer centricity, revenue and competitive advantage. Onboarding stands out as a prime area for dissatisfaction with corporate clients finding the process slow, cumbersome and opaque, while the banks see increasing costs.

Despite significant investments to make onboarding faster, more consistent and less expensive, the Finextra study has found that the cost of onboarding a new client has risen for 61% of banks with the average increase between 11-20% in the last five years. The key driver is the growth in due diligence, know your customer (KYC) and anti-money laundering regulations that have substantially increased onboarding complexity. In the survey:

  • 88% of banks agreed that KYC due diligence requirements are impacting onboarding times.
  • Only 21% think their current KYC technology is flexible enough to handle changing regulations rapidly.

It may seem that effectively managing increased regulation will require investments that detract from improving the customer experience. But this is not the case. Increasing compliance is actually an opportunity to enhance the client experience. With the right CLM technologies, banks can simultaneously deliver a customer-centric experience and meet their regulatory requirements. For example:

• Leverage a global 360° master view of the client and all related parties (including UBO’s, majority shareholders and authorized persons). This provides visibility across multiple accounts, jurisdictions, products and lines of business, satisfying client demands for a consolidated view of the relationship and helping to ensure customer centricity and competitive advantage. It enables banks to understand a customer’s relationship with the institution across retail, wealth, asset management, and corporate and investment banking. At the same time, banks can fully “know your customer” in compliance with KYC and due diligence requirements, facilitating consistency and reuse.

• Use CLM technology that includes best practices around dynamic business processing, case orchestration and rules across the customer lifecycle. This can include centralizing core KYC functions, such as refresh, new client onboarding and product onboarding across lines of business and jurisdictions while accounting for differences. As a result, regulations are accurately applied based on the driver data (such as booking entities, line of business, risk, products) and enables process reuse that reduces time and costs for global implementation. Sophisticated CLM technology provides visibility into the process for the relationship manager and client across all digital channels, including multi-jurisdictional and multi-product onboarding.

• Implement an agile, integrated KYC and CLM platform designed to provide industry best practices while managing change. As regulations such as AML, MiFID II, FATCA/CRS, EMIR and Dodd-Frank evolve, banks need to be sure regulatory changes are translatable into their KYC technology in days instead of months. An integrated platform means the bank can accelerate response to changing client needs, new business opportunities and new regulationsand do so at lower cost.

• Seamlessly integrate with multiple external KYC utilities as part of the CLM technology implementation. This ensures customer data is intelligently requested (depending on what utility the counterparty subscribes to) at the right time during the client lifecycle, and ensures data is also retrieved and displayed for sales assistants and compliance at the right moment in an interaction. Integration also increases consistency and reduces time to transact.

As you confront the growing body of regulations faced by all banks, consider compliance as an opportunity to address the client experience as well. Onboarding offers an excellent starting point, using technology in ways that simultaneously streamlines the client experience and regulatory management. Over time, the efficiency and consistency gained can be applied to every phase of the client lifecycle, leading to a far more satisfying client experience, greater compliance and faster time to revenue.

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Comments: (1)

Balasubramaniam Gd
Balasubramaniam Gd - DBS - singapore 29 January, 2016, 01:58Be the first to give this comment the thumbs up 0 likes

Indeed its complex and complicate, having said that is not easy eithe on the Consumer side for banks let it be a basic CASA account.  Its far too early days we dont have the right ecosystem to integrate legacy process and tradional approaches with TRADIGITAL market places and customers

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