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Moving to a perpetual KYC model: The benefits and the challenges

Author

Listed:
  • Isherwood, Neil

    (Compliance SME & Sales Strategy Leader, Dun & Bradstreet, UK)

Abstract

Financial services firms have been looking for many years to improve efficiency in the Anti Money Laundering/Know Your Customer (AML/KYC) onboarding process, looking towards a data led approach and automation to reduce costs. In many firms this has been a slow process with many other programmes taking priority in terms of development resource. However, the COVID-19 pandemic has highlighted that processes which involve large work forces, offshore resources and manual labour, are particularly vulnerable to disruption, resulting in institutions being unable to accept new customers due to lack of resources. This has placed a renewed focus on automation and in turn also turned attention to perpetual KYC as a method for maintaining client files, without the need for a full manual periodic review. This paper looks at the benefits of this type of approach and the challenges that organisations face to adopt it.

Suggested Citation

  • Isherwood, Neil, 2022. "Moving to a perpetual KYC model: The benefits and the challenges," Journal of Financial Compliance, Henry Stewart Publications, vol. 5(3), pages 228-236, March.
    • Handle: RePEc:aza:jfc000:y:2022:v:5:i:3:p:228-236
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    More about this item

    Keywords

    know your customer; KYC; Perpetual KYC; anti money laundering; AML; due diligence;
    All these keywords.

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • K2 - Law and Economics - - Regulation and Business Law

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