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Webinar recap: Evolving from data to risk management

By Cheri Burns | Thu 11 June, 2020

Financial crime and what effective Know Your Customer (KYC) looks like was a subject that we explored during a recent webinar with RegTech Associates.

In the second installment of their Digital Regulation Series on financial crime, our VP, Distribution and Alliances, Nick Ford, joined a panel of experts to give his views on moving from data to risk management, focusing on how automation plays an important role, how different approaches are needed for different customers and also looking at the impact of COVID-19.

We were delighted to sponsor the event, alongside iMeta and Evalueserve, and hear from engaging and experienced speakers, including Samantha Sheen, financial crime prevention professional, Ben Marsh, CEO of iMeta, and Global Head of Risk and Compliance Practice, Financial Services at Evalueserve, Anna Slodka-Turner.


KYC – Evolving from data to risk management

Presented in partnership with RegTech Associates, iMeta and Evalueserve


What does ‘evolving from data management to risk management’ really mean, and why is it important within today’s landscape? According to Dr Sian Lewin, co-founder and Head of Client Delivery at RegTech Associates:

If your data’s taken care of and being managed effectively through the use of technology, automation and the right balance with human resources, intelligent resources are available to cope or to deal with your high risk customers and enhance due diligence.

They can deal with tricky jurisdictions where it’s hard to get hold of digital records that may not even exist and you can obviously then focus more on the investigations that are complex and require a high level of human intervention and interaction to resolve.

Key insights: KYC and COVID-19

Samantha Sheen
People suddenly realise that, especially around KYC, it’s been very much process for process’s sake…Even from the regulatory front, what’s been really interesting is that it seems to have given regulators much more freedom in terms of their signalling about how people can use their KYC data.

Historically, our regulations have been misinterpreted that it’s all about taking a Polaroid snapshot of someone, but that’s what they look like on the day that you onboard them. So I think that the need for an iterative approach which is the arms embracing the risk-based approach is really proving to be the direction where things need to go, and this situation has brought that to the fore.

Anna Slodka-Turner
The challenges of the remote working, I think are there.  I think – and that’s true across all the different functions of banks and managed services – we have to run very, very fast to get to the point where we’re working like we were working a month ago. I think we’re all feeling that.

Ben Marsh
The one thing that I would say is that, anecdotally, I would expect that, if people are having or have got paper processes, that is going to be an extremely difficult way to operate in this world, especially when you’ve got people who are staff on lockdown, so therefore no kind of centralized post room operating as a way of working. One might suspect that the more automated you are, or the less reliant on paper, the easier you’re finding things.

During the webinar, we asked attendees to share their views on the topics being examined by taking part in various polls, the first of which asked how the crisis is affecting their own financial crime compliance, with some interesting results, as:

  • More than half said they were facing challenges because of remote wording
  • A third have experienced onboarding delays
  • Around 20% reported no real day-to-day impact

From data to risk management – what’s important?

Samantha Sheen
The first point really is around accuracy. Historically, we’ve always talked about the ‘four eyes approach… it took forever to actually onboard someone – we were constantly concerned about people entering data incorrectly or misinterpreting it and so all that manual hand touching that went along with the KYC was massively riddled with potential error… having that data management taken care of mitigates that risk.

We can actually understand, ‘well, how much time does it take us with a high risk customer to do the analysis?

Ben Marsh
[It’s] the ability to actually have proper online channels for engaging in customers and offer them a structured way of exchanging data with you.

The second part of that is actually all about asking, how do we make that experience, both for our internal operators and our customers, as seamless as possible by leveraging technology to source the data that’s available in public records as much as possible so people are not having to rekey that data?

And the other element, of course, is the overarching framework around that to support orchestration and full consistency of that data collection.

Anna Slodka-Turner
There are some absolutely amazing products out there, and both iMeta and Encompass can really help banks transition from data management to risk management and build on it.

[It’s about] solving a problem and making the solution work for you, putting additional technology, if needed, around the big products, so that it actually fits in the back infrastructure. That can really make a difference.

Nick Ford
I think where we’ve seen the industry move and, especially impact on our current circumstances, is really in finding technologies and companies that can work in an agile, scalable approach. We look at some best in class technologies, and especially a technology-led approach, that gives firms the ability to meet those change requirements in the current circumstances. We are working in a very different environment.

However, the impacts and pressures are still going to be there from a regulatory perspective.  We’re seeing firms looking to work in leaner ways. They’re looking at cost effective ways as well. Where we’ve seen a trend is definitely in solutions that can give the scalability and are remaining flexible in line with their requirements.

This push towards finding flexible, efficient and effective solutions was evident in responses from participants as, when polled on the highest priority in their KYC approach at the moment, 38% said automating manual processes comes out on top, while fixing existing customer data and integrating additional external data sources are also of utmost importance.

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