Using tech to automate the capture and verification of customer data

If you’re in financial services, you’ll know only too well that a customer’s decision to sign up is just the beginning of the story. The onboarding journey can be treacherous and customers are likely to have a change of heart along the way. One particularly risky phase is during the process of checks and verifications to ensure compliance with the Anti Money Laundering (AML) and Know Your Customer (KYC) regulations. We’ve taken a look at how you can make things easier.

The way things stand, the process for making the KYC checks is far too onerous. We know that the regulations are important – nobody wants to be inadvertently helping a criminal or a terrorist to launder their money – but the process is often tiresome and off-putting for customers and expensive for the bank or insurance company concerned. 

The average customer will have to produce an array of official documents that confirm their name, likeness, residential address and date of birth – simply to prove that they are who they say they are. This can also include their passport, a driving licence and a utility bill, all of which may have to be presented personally at a bank or an office. This isn’t easy. There are no longer many financial sector organisations which still have a UK-wide presence on the high street; more than 3,500 bank branches have closed in the past five years. Even without a global pandemic the simple request to visit a branch is already a significant challenge. It’s not surprising that many customers simply give up. One large UK retail bank reported that a staggering 60% of potential customers abandon their application when asked to present documentation. 

Let’s make things easier

It needn’t be like this. Technology in financial services has advanced enormously in the past two decades and you don’t need to leave your KYC compliance process trapped in the 1960s. 

  • Capture the data

The first step is to help your customer provide the information you need. Most paper documents can be scanned via a mobile phone, while online documents can be converted into an image or a PDF; there should be no need to stuff a sheaf of papers into an envelope. Ephesoft’s AI-based data capture software can learn to recognise different types of documents and then classify and extract the relevant data. It can not only distinguish between a gas bill and a birth certificate but will extract the vital details – such as name, address, and date of birth – from each. By capturing these details from every single document, you can be sure that they are consistent before submitting the customer record for further AML or credit checks. Any discrepancies can be flagged early and fast. 

  • Check the data

Having verified the essential information, a whole variety of further controls can be applied according to the level of scrutiny required. This might include biometric verification such as facial recognition via a video selfie, but in all cases, the data in the documents can be crossed-checked against the information submitted in the customer’s application. Figures on a bank statement, for example, can be compared against the stated income or monthly spending declared by the customer. Again, if discrepancies arise, they can be flagged quickly, rather than waiting weeks for a manual check to take place. 

The new fintechs are already ahead when it comes to onboarding. Monzo, for example, with no branches, invites customers to “open a new current account while you wait in the queue to buy your lunchtime sushi or sandwich.” All documents are submitted online, with further KYC information, such as changes in income, gathered during the lifetime of the customer. Revolut also promises new customers that they can join “in minutes”.

The sheer convenience of these services makes it essential that you get the right tech in place in order to compete. Investing in the right technology can slash administration times and improve productivity, cut costs and transform the customer experience. There’s everything to play for – and you can make onboarding a smooth, painless, and rapid process. 

Want to learn more about intelligent document processing for financial services? Request a free trial or contact us for more information.

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