Special Report Best Practice Client Onboarding... 7 | Best Practice Client Onboarding It is clear...

Special Report

Best Practice Client Onboarding

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3 | Best Practice Client Onboarding

TABLE OF CONTENTS

INTRODUCTION 4

FOREWORD 6

Q&A WITH CLIENT ONBOARDING PRACTITIONER 8

THE IMPORTANCE OF CLIENT ONBOARDING 11

CHALLENGES OF ONBOARDING 13

BEST PRACTICE APPROACHES AND SOLUTIONS 18

OPPORTUNITIES OF SUCCESSFUL IMPLEMENTATION 22

OUTLOOK 24

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Client onboarding is central to the success of banks, yet it continues to present challenges and opportunities of implementation are often elusive. The challenges arise from siloed systems, manual processes, poor entity data quality, lack of agility and, of course, the constant pressure of regulatory compliance. Challenger banks, based on greenfield sites and with unencumbered onboarding processes, are also chasing market share.This special report discusses the importance of onboarding, the need for change, the challenges of getting it right, and the tools, technologies and shifts in internal culture that can deliver success This includes not only an excellent experience for clients, but also business benefits of improved client acquisition and loyalty, better understanding of clients, reduction in costs, a gain in competitive advantage, and confidence in compliance.On a wider scale, accurate entity data and an enterprise approach to data management should help organisations, regulators and jurisdictions tackle the spiralling volumes of money laundering that could threaten local and global economies. Looking forward, innovative technologies, such as artificial intelligence, machine learning and natural language processing, will lead the development of effective, efficient and compliant client onboarding. An internal culture that recognises the need for accurate, shared data and strong relationships between the business and onboarding teams will also be crucial. Summing up, the report includes an insightful Q&A with the head of client lifecycle management at a leading bank.I hope this special report will help you navigate the choppy waters of client onboarding and would like to thank Fenergo for sponsoring its production. We’ll continue to update you on onboarding, its technologies and potential with blogs on our Data Management Insight website – www.datamanagementinsight.com – as well as webinars and events that you can sign up for on the website. Angela Wilbraham CEO A-Team Group

THE TIME FOR CHANGE IS NOW



The digitalisation of financial services has long been a focal point and while some financial institutions are making headway by transforming front-office processes, client onboarding remains a sticking point. Rigid, legacy technology stacks, siloed data, the unrelenting march of regulation and poor collaboration between business lines make client onboarding an operational and experiential nightmare. These operational silos and absence of a single customer view are having a detrimental effect on the end-customer experience throughout the client lifecycle and, crucially, the bottom line as a result. Customers looking to open an account or purchase a new product are faced with lengthy, manual onboarding processes with repeated requests by the financial institution to provide data and information. In the commercial, business and retail spaces, banks find themselves in a digital arms race. Rival banks engaging in digital transformation and new, digital-first neobanks including Revolut, Starling, OakNorth and Monzo entering the market have disrupted the traditional, established way of doing things. Incumbents are struggling to keep up and customers are turning away in droves. A recent study by Fenergo of key decision makers in commercial and business banking across EMEA, North America and APAC revealed that USD $3.3 trillion was knocked off the global business and commercial banking market as a result of abandoned applications during onboarding. 78% of those surveyed have lost customers to neobank competitors in the past 12 months, which is unsurprising considering onboarding timeframes have increased by up to eight weeks for 21% of banks. And the reason? Banks are almost unanimous (96%) in blaming increased and fast-evolving regulation for longer client onboarding times. For corporate and investment banks the landscape is similar. A survey by Fenergo of C-suite executives at global corporate and investment banks revealed that 67% have lost clients due to inefficient onboarding. Data management is a major hurdle for these banks, which is a concern considering they must comply with evolving global and regional regulations for their large-scale, multi-jurisdictional clients. The same survey found that 29% of banks rate themselves as mediocre (five on a scale of 1 – 10) for collaboration between departments and business lines.

FOREWORDBY NIALL TWOMEY, CHIEF TECHNOLOGY OFFICER, FENERGO



It is clear from these results that the financial services sector has reached a critical point in its evolution. We find an industry where there is resistance to change and one which is responding slowly to the threat of disruptive challenger banks. Yet even neobanks are not immune to disruption. There is rising nervousness amongst challenger banks about the inevitable onslaught of big tech. After years of rumour and tentative toe dips, the big four (Google, Amazon, Facebook and Apple) are making moves into the retail banking space. With the big four’s combined reach, the move represents a real gear shift in competition for financial institutions across the board. If the financial firms currently losing the battleground on customer experience within onboarding don’t adapt and evolve quickly, many will become obsolete. Onboarding, being the first touchpoint for customers, presents a major opportunity for financial institutions to digitally transform client experiences, establish customer loyalty and gain competitive edge from the offset. A customer-centric technology infrastructure, that connects front office CRM systems (such as Salesforce) to middle office customer or entity data and AML screening systems (such as World-Check), will enable financial institutions to streamline entire client journeys from onboarding to offboarding and all the lifecycle events (and associated KYC/AML verifications) in between. The adoption of an integrated Client Lifecycle Management (CLM) strategy will be imperative in achieving this. This will involve the client application being guided seamlessly through all internal approval stakeholders (including sales, credit, legal and compliance) via straight through processing. For clients who want to be onboarded quickly and efficiently, and start trading or transacting immediately, the experience will be fast and frictionless. For the financial institution, operational efficiency gains will reduce costs and accelerate time to revenue. Fenergo’s close alignment with our community of clients allows us to really understand the regulatory and digital challenges financial institutions are faced with today. This has enabled us to create solutions that meet their exact needs, while enabling them to compete on a more even playing field to disruptive competitors.



While client onboarding is key to success for capital markets participants, for some its challenges remain burdensome and its opportunities difficult to achieve. To find out how to face these challenges and get the most out of onboarding, we talked to Chor Teh, head of client lifecycle management at Investec.

Q: Why do firms need to get client onboarding right? A: From a cost and operational perspective, if you don’t get it right this will duplicate work, a factor of high operating costs in the long run. On the client side, it will result in additional touchpoints throughout the client lifecycle – clients are irritated by being asked for the same information over and over again. Excellent client experience is essential, not only to the client, but also the business.

Q: Where are the pain points and where does onboarding go wrong? A: Pain points are typically caused by a lack of transparency between the business and client onboarding team. Onboarding is not a black box process, the team needs to sit down with the business to help the business get a better understanding of what the team does and what it needs. There are many reasons why onboarding goes wrong, including technology and process issues. One of the main problems is Service Level Agreements (SLAs) that are often one directional from the business to the onboarding team. The focus really needs to be on the client, hence mutual SLAs are crucial. If the onboarding team is being asked to turn around quickly, the business must do so too, and both teams should be held accountable for the onboarding process.

Q: What processes can firms put in place to ease the pain points and avoid things going wrong? A: One approach to this is to align onboarding analysts with specific businesses to ensure they understand how the business works and can

Q&A WITH A CLIENT ONBOARDING PRACTITIONER



provide suitable services. This structure means there are clear requirements across all clients of a business and you can provide consistent answers to the clients.Technology and automation can help you avoid some of the things that can go wrong in the onboarding process by reducing copy and paste, minimising duplicate data, and ensuring the best possible sourcing of entity data from public sources. Technology can also be used to set levels of what data is and isn’t acceptable to the onboarding process. This can streamline acceptable data being fed directly into onboarding systems, and unacceptable data prompting manual review. The use of Application Programming Interfaces (APIs) to sources of sanctions databases and watchlists, screening systems and adverse media is also key to end-to-end automation.

Q: What best practices have you seen with regard to data management in support of client onboarding? A: Taking a data driven approach to client onboarding can be successful. This can be achieved using a solution that is built on the concept of data rather than workflow, and that can support scalability and manage multiple aspects of a single piece of data. The ability to link multiple aspects of a single client record can deliver the ultimate goal of a single view of each client. For example, the same individual can be represented as a director, Politically Exposed Person (PEP), guarantor, ultimate beneficial owner and so on.

Q: How can accurate onboarding be sustained over the long term? A: This is interesting and something many banks are working towards. It is not about one-off processes, but developing an ecosystem with many linkages that can support sustainability over time.If you get onboarding data right first time around, there are benefits in managing periodic client reviews and and responding to triggered events, as in many cases you will only need to ask a client a couple of key questions



and then check and validate the data externally. This avoids asking clients for documents and data again and again, and provides a streamlined approach to long-term sustainability of correct client records, while maintaining compliance.

Q: What are the biggest results you have seen from a successful implementation of a client onboarding solution? A: The answer to this question is simple – at my bank, an uptick in onboarding efficiency of 30%. With automation, we can onboard up to 100 clients per month without compromising on any data and with control.The business gets a shorter time to market, with clients being onboarded in as little as a few hours, or a day, and this becomes a USP for the bank that helps not only client acquisition, but also loyalty. From a regulatory perspective, banks can maintain compliance with financial crime policies. Clients gain benefits of efficient onboarding, the ability to add new products easily, and timely interaction with the bank. Going forward, a big advantage for clients and the bank will be self-servicing. It’s scalable, brilliant for the business, and gives clients more control and the ability to see their status online. We are planning a soft launch of a self-service client portal soon.



THE IMPORTANCE OF CLIENT ONBOARDING

Client onboarding is key to customer satisfaction, revenue and business growth. It should be, but is not always, the nerve centre of financial services firms offering products and services to any type of client. It is also essential to compliance with regulatory requirements such as Know your Customer (KYC) and Anti-Money Laundering (AML), which are designed to prevent use of the global financial system for money laundering and terrorist financing. At the heart of every client’s journey, it must also be central to a bank’s digital

transformation. From a client perspective, onboarding is the first step a client will take with a product or service provider and is likely to be central to making or breaking the relationship. It is also a factor of longer-term client satisfaction and loyalty, the basis of personal recommendation to other potential clients, and the beginning of a journey that could cover the purchase of numerous products from one supplier. It needs to be quick, seamless, personal, responsive, and provide an excellent customer experience. From a business perspective, meeting these requirements for each client is difficult – but failing to provide an effective onboarding service is not an option in a fiercely competitive market where traditional banks face the threat of challenger banks, clients are increasingly savvy about what they want, and the number of product applications abandoned during onboarding continues to rise.

Regulatory requirementsWhile client onboarding is critical to building trust with individual clients and on a broader scale a sustainable and highly valuable client base, it is also an important area of regulatory compliance. At an initial level it includes KYC and client due diligence (CDD), the process of identifying and understanding the risk presented by clients before doing business with them. Enhanced due diligence (EDD), a more detailed verification process, is used to mitigate risk where there could be more

WHAT CLIENTS WANT4 Communication on their

terms4 Choice of personalised

products 4 Multiple access channels to a

product provider4 Only information that is

relevant to them4 Reuse of previously provided

information4 Strong engagement and

affirmative response4 Fast and smart onboarding

and ongoing interaction



opportunity for money laundering or terrorist financing as a result of a client buying a product or service. The KYC process includes screening client information against sanctions, politically exposed persons (PEPs) lists and other watch lists, and must be revisited frequently to ensure client information is up to date and, from a privacy point of view, that clients have proactively given consent to the use of their personal data. KYC and client onboarding are also essential to AML and countering terrorist financing (CTF), although this area is an arena in which regulators are struggling to keep up, with global money laundering and terrorist financing spinning out of control. One of the few solutions to arrest this trend is, manifestly, improved client identification and onboarding. The importance of getting client onboarding right is enormous for clients, banks and the global economy, and there is willingness in the financial services industry to make improvement. However, this is currently limited by client onboarding models that are predominantly manual rather than automated. This is illustrated in the chart below that shows responses to an audience poll during a recent A-Team Group webinar titled ‘Client Onboarding – how developments in technology and automation can help optimise entity data management and improve KYC’.

WHAT DOES YOUR ORGANISATION’S ONBOARDING MODEL LOOK LIKE?90% people, 10% technology 33%

28%

27%

6%

5%

50% people, 50% technology




WHAT ARE THE KEY CHALLENGES OF KYC AND CLIENT ONBOARDINGAT YOUR ORGANISATION?Too much manual intervention 80%

68%

43%

13%

3%

Poor data quality

Inadequate data management

Lack of required skills

No challenges

WHAT BENEFITS DOES YOUR ORGANISATION GAIN, OR EXPECT TO GAIN,FROM IMPROVING ENTITY DATA QUALITY & AUTOMATING ONBOARDING?

A reduction in manual intervention 72%

69%

49%

48%

36%

A decrease in risk

Better customer satisfaction

A better handle on financial crime

Less false positives

WHAT ARE THE BARRIERS TO IMPLEMENTING A DIGITALISED CLIENTONBOARDING PROCESS AT YOUR ORGANISATION?

Cost is too high 53%

50%

50%

34%

28%

Culture within the organisation

Skilled resources

Regulatory compliance

Lack of management buy-in



The biggest challenge facing the financial services industry is how to get the client experience right and satisfy each and every client. This includes reducing onboarding time, cutting out paperwork, providing interactive services, and taking a personalised approach to each client. It also includes regulatory compliance.While the challenges of client onboarding are similar to those of other functions driven by data management across financial services firms, in this instance they are magnified by the scale and speed at which client data should be processed, and the high level of data quality that must be achieved to deliver a compelling client experience and watertight compliance.The results of a poll question posed during an early 2019 A-Team Group webinar covering ‘Improved client onboarding to enhance the customer experience and digital journey’ show high costs as the main barrier to implementing a digitised client onboarding process, followed by organisational culture, resource, regulatory compliance and lack of management buy-in.

CHALLENGES OF ONBOARDING


28%

27%

6%

5%






68%

43%

13%

3%

Poor data quality



No challenges



69%

49%

48%

36%

A decrease in risk






50%

50%

34%

28%


Skilled resources





A similar poll question with slightly different answer options asked during the webinar towards the end of 2019, ‘Client onboarding – how developments in tech and automation can help optimise entity data management and improve KYC’, notes the challenges of KYC and client onboarding as too much manual intervention, poor data quality, inadequate data management, and lack of required skills.

Gathering these challenges together suggests the biggest barriers to successful client onboarding are manual processes, data and data management issues, cultural resistance, lack of required skills and, of course, regulatory compliance.

Manual onboardingOnboarding clients using typical paper-based manual processes is slow, high risk and unsustainable. Securing, organising and storing signed client documents that are required for regulatory compliance can be fraught with human error, and clients are often asked many times for the same documents as they purchase products from different businesses within an organisation.


28%

27%

6%

5%






68%

43%

13%

3%

Poor data quality



No challenges



69%

49%

48%

36%

A decrease in risk






50%

50%

34%

28%


Skilled resources





The results of manual processing include poor client satisfaction, client withdrawal from purchase processes, a huge shortfall in business understanding of clients, and compliance breaches, which have been known to cost firms millions of dollars.

DataEntity data that identifies clients is critical to onboarding and client lifecycle management, as well as to regulatory regimes including KYC and AML, client screening, sanctions compliance, and business development. To ensure a complete understanding of clients, beneficial ownership and hierarchy data may also be required to show links between entities and assess the risk of onboarding particular clients. The importance of entity data was identified in the 2008 financial crisis, when neither regulatory nor financial institutions had access to the data necessary to track parties to transactions and measure counterparty risk. This led to the regulatory creation of the Legal Entity Identifier (LEI), a standard entity identifier that, where available, should be used in client onboarding. The challenge presented by data in onboarding processes is lack of quality, completeness, timeliness and consistent cross-referencing identifiers. From a business perspective, poor data quality slows down client onboarding – and can make it grind to a halt, damages client engagement, adds compliance risk, and makes it impossible to get a true 360-degree view of all clients that can be used to personalise product offerings, extend market reach and support new product development. Slower than anticipated take-up of the LEI is also limiting entity data quality and standardisation, while recent industry estimates show that the financial services industry spends $2-3 billion dollars a year cleaning data. Further studies show that business data is estimated to decay at a rate of 25% a year, making consistent entity data quality an elusive goal.



Data managementMost entity data quality issues result from data management models that are far from contemporary and include numerous data silos and legacy systems storing and using conflicting datasets, manual data collection and management processes, and inconsistencies in entity data feeds from data vendors. These problems cause data duplication, version issues, incorrect records and incomplete datasets that can lead to poor client onboarding and lifecycle management, operational inefficiency, risk exposure, and inaccurate regulatory reporting.These types of models also stand in the way of automated client onboarding, which is becoming essential to client satisfaction, regulatory compliance, and identifying new business opportunities.

Company cultureAn organisation’s internal culture can be pivotal to the success or failure of client onboarding programmes, as well as to competitive edge in a market where digital-first challenger banks are competing for traditional bank customers. Where management buy-in, project champions, and budgets are in short supply, programmes will falter, and business silos will continue to operate inefficient, isolated and duplicate client onboarding. Compliance risk will rise, and any budget committed to onboarding will, to a certain extent, be wasted. Similarly, nascent automation projects may never take flight. Company culture can also suppress the internal development or external hiring of required skillsets for client onboarding, a challenge that can magnify the problems of getting client onboarding right – every time.

RegulationRegulation is never far away, with client onboarding required by AML regulation to satisfy an increasing number of background checks and



verification of a client’s identity, often including beneficial ownership and hierarchy data to understand a client’s relationships and potential risk to the onboarding organisation, which may, where risk is deemed too high, decline to onboard a client. The EU’s Fifth Anti-Money Laundering Directive (5AMLD), coming into force in January 2020, expands the requirements for client onboarding – including substantially upgraded requirements for the data that companies must hold – such as ‘adequate, accurate and current information’ on beneficial ownership, which has caused some concern around how firms might be expected to report against different national regulations.Potential clients must also be checked against sanctions lists that are made and maintained by organisations such as the US Office of Foreign Assets Control (OFAC), the United Nations (UN) and EU member states working in line with sanctions made through EU law. The lists change continually and grow rapidly, requiring screening applications to monitor them closely to identify sanctioned individuals, organisations, and countries, and avoid too many false positives. Checks must also be made against lists of politically exposed persons (PEPs).Balancing the delivery of a friction-free client onboarding experience while meeting regulatory requirements is no mean feat. As noted above, failure to do so can result in large financial fines and reputational damage.



Client onboarding is one of the most pressing challenges for financial services firms and itself presents significant compliance and customer satisfaction problems, but there are approaches, solutions and technologies that can improve performance. Automation and digitalisation programmes that make onboarding a high priority objective are key, with targets around client acquisition, loyalty and growth. Cost containment, competition and business opportunity are also important – as are the fundamentals of high quality client data and effective data management.

ApproachesIn a market where an individual may look at product options on a laptop, begin to fill in an application form on a phone and then walk into a branch of a bank, firms need to approach client onboarding with an integrated multi-channel approach that includes every client touchpoint across the business. A structured approach is important, not just to reduce operating costs and drive up automation, but also to identify potential onboarding opportunities. It needs to consider where the firm is on the road to automation and how manual processes can be automated – although there will always be some human intervention around exceptions. Other issues include the quality of client data and how it should be improved to produce a single, accurate record of each client; the extent of change management and data governance resource needed; and who will champion and lead the implementation programme. A business case can be built around the reputational damage and regulatory costs of getting client risk ratings wrong, and on a more positive basis, on the potential to attract and keep more clients that purchase more products and generate more revenue and profit.A strategic approach to onboarding must be backed by strong data governance and lineage that will also provide firms with robust risk

BEST PRACTICE APPROACHES AND SOLUTIONS



management, a deep understanding of client relationships, and a platform that can not only answer questions from regulators, but also offer opportunities for cross-selling and new product development. Approaches to operational data management for client onboarding should include the LEI where available. While the identifier has not yet gained as much traction as initially expected, it is a good cross reference point for multiple proprietary and vendor entity identifiers, and links entity datasets across an organisation. Using a master data management approach to source and integrate LEIs, proprietary identifiers and vendor identifiers from multiple systems, map them and reconcile underlying data, it becomes possible to see benefits. Regulatory requirements for client data can be met, a single version of client data can be delivered to downstream applications, the data can be enriched with entity relationships and hierarchies to discover ultimate beneficial owners, an audit trail can be confirmed, and a 360-degree view of customer data can be achieved.

SolutionsData – Accurate, complete and timely client (or entity) data is fundamental to effective and compliant client onboarding. Without high quality data that is continually maintained, onboarding processes will falter or fail and any hopes of delivering an outstanding customer experience will be dashed. Acknowledging the importance of entity data quality, many firms work with third-party specialists to clean, validate and ensure the ongoing quality of client datasets including sometimes difficult to source beneficial ownership and hierarchy data. Considering the amount of data that must be processed, automation with exception management is essential. A practical solution to improving data quality, particularly where data is spread across many silos, is to implement a master data management solution. Fuzzy matching can identify duplicate records and merge data



to create single records, and entity data diagnostics that identify and prioritise data quality issues can be used to establish a baseline and monitoring schedule to ensure quality is maintained at a specified level. Data quality metrics provide constant measures across datasets and can be used to support a continuous iteration of measurement, decision making and data remediation.Innovative technologies, such as Artificial Intelligence (AI), particularly machine learning, are beginning to be offered by vendors to support client data quality and increase automation and digitalisation. Natural Language Processing (NLP) provides a means of identifying entity data in unstructured data, such as text, and extracting and cleansing the data. Over time, these technologies will help to drive automation and digitalisation, vastly reducing the time taken to onboard clients, while providing a much better customer experience.

Data management – Initially, most banks developed data management platforms in-house, but the sheer volume of data that must be handled for client onboarding and related regulations means many have migrated to vendor applications and services, or developed hybrid build-and-buy solutions. Vendor solutions can offer specific elements of client onboarding, such as entity data sourcing or sanctions screening, or complete and ongoing client onboarding solutions that can morph into client lifecycle management platforms. While the end-game is happy clients, there are a number of ways to get there. Vendor solutions include enterprise software, hosted solutions, managed services, data utilities, and web services. Enterprise software is deployed in house by financial institutions to manage client data, typically taking a master data management approach that provides a single view of each client and its relationships across a business. This can be used to facilitate client onboarding, regulatory compliance, cross-selling and a better understanding of risk exposure. Expected improvements from implementing enterprise software include



greater operational efficiency through automation, reduced cost and enhanced data quality and understanding. Firms with limited IT resources or strategies to outsource non-core activities can benefit from hosted solutions that remove the burden of deploying and maintaining software in house and provide access to client onboarding platforms that are hosted and maintained by a vendor. These solutions provide a dedicated instance of the software for each client, increasingly in the cloud, as well as ability to configure the software to meet business needs. Expected benefits include reduced total cost of ownership, increased speed to implementation, enhanced data quality and a lower skills requirement. Like hosted solutions, managed services are often hosted in the cloud and remove the burden of in-house software, but unlike hosted solutions they are based on a central vendor-managed platform that is used by many clients. Typically, a managed data management service will cleanse, deduplicate and validate entity data, and map vendor and industry standard entity identifiers to a client’s identifiers to deliver an entity master that can be used to drive client onboarding, sanctions screening and compliance. Expected benefits of managed services include reduced total cost of ownership, increased speed to implementation, flexibility to meet changing requirements and enhanced data quality. Utilities aim to ease the industry’s data management burden and deliver economies of scale by consolidating non-competitive data management processes that are repeated across financial institutions. While the utility model has yet to be proven, expected benefits would largely match those of other managed services. As firms reduce dependency on internal client data services, web services are providing application programming interface (API) access to vendor client data. Typical functionality of these services includes client identification, data population, master data management and monitoring. Expected benefits include reduced costs, increased speed to implementation, flexibility to meet changing requirements and better data quality.



An automated customer onboarding solution, potentially including machine learning and possibly other strands of AI, and with the ability to scale, can deliver huge value to the business and significant cost efficiencies to operations. Embedded in a digital transformation programme, the solution becomes central to a data-driven organisation. From a customer perspective, a successful onboarding system provides multi-channel yet consistent access, faster processing times, more efficient information gathering, reduced paperwork, availability of a set of products and services dedicated to their particular needs, and real-time interactive engagement with the bank. Compliance with KYC rules and AML regulation is also eased, giving banks more time to focus on core business issues. The importance of these benefits can be seen in the webinar poll results charted on page 23.

Business opportunitiesInitial benefits of automated client onboarding with a digital workflow range from faster onboarding to fewer dropouts from the onboarding process, greater client loyalty and the ability to scale in response to client demand. Beyond these benefits, banks can gain a greater understanding of their clients, support digital client and account journeys, predict and offer products and services suitable to selected individuals, and automate client orchestration on a wide scale. A better understanding of clients can also reduce risk, with banks being able to decide whether or not to onboard high-risk clients. Perhaps most importantly, banks can use accurate and readily available client data and strong client relationships to take advantage of business opportunities to develop and sell new products and services, cross-sell and up-sell, reach additional client sectors, and drive up revenue and reduce costs.From an AML perspective, automation and digitalisation of KYC and onboarding, based on the highest quality entity data available, can increase transparency, reduce false positives, help banks identify ‘bad actors’ and understand who they are doing business with, and reduce exposure to risk.

OPPORTUNITIES OF SUCCESSFUL IMPLEMENTATION



Operational gainsAutomated client onboarding offers many operational efficiencies, including the ability to reduce manual intervention, process larger volumes of client accounts, scale as necessary, avoid duplicate and inaccurate client records, and reduce the cost of opening each account and onboarding across the organisation. Digital workflow also reduces exceptions, raises alerts and improves exception management. More time can be given to personal interaction with clients and client decisions, perhaps to open an additional account, can be handled using existing client data and information specific to the new account, once again cutting out the need to ask clients for the same data many times and reducing duplicate data entry. Automation also reduces the costly, error prone and wasteful process of managing traditional paper

forms used for client onboarding, and instead provides a centralised digital document archive. Combining automated onboarding with a digital signature solution can greatly enhance the digital workflow and all but eliminate paper.

OPTIMISED CLIENT ONBOARDING OFFERS:4 Faster account opens4 Faster account updates4 Elimination of manual errors4 Fewer dropouts4 Reduced admin time4 Increased client time4 Reduced cost4 Improved compliance4 Reduced risk4 Scale to grow4 Agility to accommodate change4 Excellent customer experience


28%

27%

6%

5%






68%

43%

13%

3%

Poor data quality



No challenges



69%

49%

48%

36%

A decrease in risk






50%

50%

34%

28%


Skilled resources





Innovative technology, digitalisation projects and the real need for banks to revolutionise customer onboarding if they are to stay healthy will drive ongoing development of the customer experience over the next few years. With competition from challenger banks and between traditional banks also increasing, there will be winners and losers. Machine learning is already being implemented into the onboarding process at some banks and will find favour at more. Going forward, it will also be important to explore the value of other strands of AI and technologies including natural language processing, text analytics and semantics to client onboarding projects, and doubtless, additional technologies that will emerge. Increasing client interest in environmental issues, including reduction in the use of paper and postage, will also play a small part in ranking client onboarding solutions. If ongoing improvement of client onboarding processes is key, so too, is bringing the underlying client data into sharp focus. The criticality of this data, and its accuracy, quality and availability, will continue to rise as firms acknowledge the centrality of client onboarding to business. It is also of utmost importance to firms, regulators, governments and jurisdictions as they move forward with the search for ‘bad actors’ in an effort to cap and reduce soaring levels of anti-money laundering that could ultimately cause both local and global economic damage. Again, innovative AI technologies need to be implemented to counter ever more ingenious financial crime. Client onboarding may sound simple to the layperson, but it will always be a challenge for banks striving to offer the best and most competitive client experience from onboarding through client lifecycle management and on to offboarding. Developing solutions that will ensure the client is king or queen will remain a challenge.

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