Swift signs major banks to KYC Registry
04 March 2014 | 9649 views | 2
Interbank messaging network Swift has recruited a group of major banks to help develop its centralised KYC utility for the collection and distribution of standard information required by banks as part of their due diligence processes.
The group, which includes Bank of America Merrill Lynch, Citi, Commerzbank, JPMorgan, Societe Generale and Standard Chartered, will work together with Swift to build the service, which is intended to help banks manage their compliance challenges and reduce the high costs associated with implementing KYC-related regulations.
Swift says it will operate the KYC Registry as an industry-wide utility with an initial focus on correspondent banking relationships. More banks are expected to join the initiative in the coming months.
Javier Pérez-Tasso, chief marketing officer, Swift, says: "It is encouraging to see the banks coming together around this initiative, which clearly demonstrates the value community-based solutions can bring to this challenge."
As a part of the MOU, the banks will participate in a Swift-led working group to agree the Registry's processes as well as the documentation and information necessary to fulfil KYC requirements across multiple jurisdictions. In addition, the banks will start populating the registry with their own KYC data.
Each Registry user will have a standardised access point to obtain details on their counterparties, while retaining ownership of their own information and control over which institutions can view it.
Pascal Augé, head of global transactions & payment services, Societe Generale, says: "One of the major challenges with KYC activities is maintaining accurate information. Having a single, centralised Registry for up-to-date KYC information will reduce the time, effort and cost related to gathering, accessing and sharing KYC information."
Swift's KYC Registry faces competition from a number of other competing initiatives which promise to help financial services firms as they struggle to collect monitor and maintain the up-to-date, proprietary information necessary to meet the dynamic requirements of global mandates such as KYC, AML, Dodd-Frank, Emir, Fatca and Gatca.
In January, Switzerland-based KYC Exchange launched a Web-based communication platform for Know Your Customer (KYC) and Customer Due Diligence (CDD) data sharing for the international banking community.
The following month, Strevus, a San Francisco-based startup providing data sharing risk and compliance management technology to financial service institutions, raised $5.6 million in a series a funding round led by Blumberg Capital.