Encompass Corporation, the provider of the leading Know Your Customer (KYC) automation platform, has unveiled its perpetual Know Your Customer (pKYC) maturity model, setting a new benchmark for regulatory compliance to support the fight against financial crime
The model, which has been devised by the pKYC Advisory Board – comprised of representatives from leading global banks and a selected group of trusted data, technology and consulting partners – is designed to place financial systems into a pKYC framework to evaluate their maturity and readiness to more effectively identify and prevent financial crime.
pKYC is considered a “dream state” for many big players in the banking industry, using automation technology to detect risk faster and more accurately. It also increases operational efficiency by removing the need for increased headcount or time commitment.
Currently, it is most common for financial institutions to re-assess customer data at intervals of one year for high-risk customers, three years for medium risk, and five years for those considered low risk, opening the door for activity to go undetected for long periods of time.
The framework evaluates financial institutions on five core areas: Policy, People, Process, Data, and Technology. These factors are then broken down into subcategories and attributed a necessity against the four stages of KYC: Manual KYC, Early Automation, Mature Automation, or pKYC, to benchmark readiness for pKYC.
With this model, Encompass is helping banks consider preparedness for pKYC, facilitate stakeholder discussions and evaluate the progress of transformation journeys, offering advice and technology solutions to fast-track the process.
Howard Wimpory, KYC Transformation Director for Encompass, said: “Against the backdrop of a more stringent regulatory landscape, and increasing fines and enforcement actions, it is more important than ever for financial institutions to know where they stand regarding compliance.
“Manual processes allow financial risks to go undetected for weeks, months and even years, so a review of processes, and the adoption of automation technology, is critical.
“Speed of identification is the main goal for banks, which should realistically aim to check changes to customer risk data in near real-time to swiftly and accurately identify financial crime. Achieving a state of true pKYC isn’t an overnight process, so institutions must constantly build their technology infrastructure to support the automation of core processes.
“Those at an advanced stage of digital transformation are best equipped to keep pace with the evolving regulatory landscape, ensuring robust compliance processes, and protect themselves and society against financial crime.”
Alongside the pKYC maturity model, Encompass has released a Planning your journey to perpetual KYC industry whitepaper, providing a deep dive into pKYC and unpacking the core components required to achieve this “dream state”.
Encompass enables firms to deliver revenue faster, drive operational efficiency and demonstrate consistent compliance with dynamic KYC process automation.
Our award-winning platform, unrivaled data connections and industry expertise help clients to create and maintain real-time digital risk profiles of everyone they do business with.
Our customers include leading global banks and financial institutions, including Wolfsberg Group members. We have strategic alliances with a range of trusted data, technology and consulting partners, enabling a seamless integration of Encompass into existing workflows and systems.