Don’t be misled–true eKYC delivers Golden Record, not just higher-tech versions of traditional KYC
If you believe the internet, every modern KYC solution delivers eKYC by default. AML software vendors slap the “eKYC” label on whatever KYC product they’re trying to upsell. Don’t be misled: True eKYC refers to the eKYC Golden Record. Everything else–ID verifications, uploads of digital documents, online form-filling, biometric verification, etc.–is actually modern-day KYC, not eKYC. (To learn about core features of modern KYC software solutions–what many vendors upsell as eKYC–check out Part 1 of this KYC software series on the essential features of KYC software solutions.)
Your modern KYC software might be very good–and it likely leverages digital tools, API interfaces, digital uploads, and more. In fact, we at AML Partners offer exceptional KYC software that maximizes technology options, integrated tools, automation, and API interfaces. But maxing out time-saving technology assistance in your KYC software should be the floor, not the ceiling.
What is true eKYC? What is eKYC Golden Record?
The eKYC Golden Record–i.e. true eKYC–is a term that describes compiling digital golden-record KYC collections at a central locale and sharing with authorized users across the enterprise. Institutions that leverage eKYC technology eliminate duplicated effort in their KYC Compliance.
These institutions also transform the accuracy and customer satisfaction related to their KYC collections. With the digital Golden Record, institutions onboard a customer once at a central locale. And that record is shared at every authorized branch location.
Accuracy, flexibility, and mind-blowing efficiency
Know Your Customer—or Customer Due Diligence—in AML Compliance provides the foundation for anti-money laundering analysis. And KYC also provides a crucial keystone to counter the financing of terror. But financial institutions often find KYC to be an expensive bugbear. Yes, modern KYC software has improved the process exponentially, but KYC collection remains a major cost center in AML Compliance. A major part of that cost lies in duplicated efforts at various branch locations.
True eKYC Golden Records have solved that previously intractable problem. It facilitates for an institution the collection of single digital comprehensive KYC collection. And because institutions can designate a central location for all KYC work, duplicate effort at branch locations disappears.
Another feature of eKYC Golden Record crucial to institutions lies in the ability of the home office to adjust access permissions. Permissioning technologies mean that home offices control access in order to comply with the California Consumer Privacy Act or the GDPR, for example.
The eKYC Golden Record also solves the problem of AML and GRC regulations that vary by country. Previously, institutions felt compelled to authorize duplicate KYC collections in various countries to account fully for regulations specific to each location. But branches may add to their copy of the Golden Record to satisfy local jurisdictional requirements. Those local additions do not affect the one Golden Record.
The golden ticket to controlling cost and quality in crucial KYC collections
The eKYC Golden Record represents that elusive golden ticket in ever-spiraling costs and requirements for AML Compliance. Amazingly, it delivers the happy marriage of lower-cost KYC while achieving peak accuracy and flexibility, especially for institutions with multiple locations.
It’s stunning, really, how far KYC and AML Compliance have come since the inflection point of 9/11 in 2001. Those terror attacks–and the many that have followed in countries around the globe–supercharged the stakes of keeping criminals and terrorists out of the global financial system. What started as manila folders jammed with paper KYC collections evolved slowly and painfully at first. But AML Compliance technologies have evolved rapidly in the last decade. And today, true eKYC manifests in the eKYC Golden Record–comprehensive KYC collected at a central locale and shared to authorized branches.
The logistical nightmare of those paper-packed manila folders stored in thousands of steel file cabinets has receded into memory. Modern KYC software offers streamlined and efficient ways to verify customer identities and compile comprehensive AML KYC records in digital form. But it’s the eKYC Golden Record that leads institutions to next-level achievement and efficiency in KYC and AML. (To see an AML Partners’ case study on eKYC Golden Record, click here.)