Know Your Customer (KYC) verification is the foundation needed to comply with anti-money laundering (AML) regulations. Implementation of a successful customer onboarding strategy needs an effective KYC verification process. And to meet all these demands, you need a world-class KYC provider.

1. 08
Feb
The digital transformation has been setting new rules for customer service across a large fraction
functionalities. Even in the recent past, customer onboarding largely remained as traditional face-
Designing Client-Centric Digital Customer Onboarding Solutio
Sector
 By Jay Raol | 
In Customer Onboarding |

2. One of the key reasons was to build stronger emotional attachments, gain trust and nurture long-
with the customers.
The emergence of digital transformation and end-to-end digital services in banking has put press
institutions to do more for the sake of convenience for today’s banking customers. Replicating an
seamless customer experience with a focus on speed, standardization and simplicity is no easy fe
environment.
As the banks were caught in the conundrum of whether to digitize customer onboarding or not, th
pandemic acted as a catalyst thrusting the banks towards the inevitable. Banks could no longer p
embracing full-scale digitalization.
The Current Status of Digital Customer Onboarding in t
Sector
The digital customer onboarding in the banking sector was mainly driven by two factors; the pa
money laundering (AML) policies. Depending on where you live, both factors may not have had a
the way you bank. Despite threats of penalties and demands from customers, banks are still slow
customer onboarding practices.
The reasons behind the slow change may have to do with three main factors:

3. The potential loss of customer loyalty
Lack of knowledge and experience in designing a client-centric digital customer onboarding p
Retaining access and control of cybersecurity systems and protection of customer data
In some companies or countries, there is also the added concern in the reduction of labor needs.
putting more people unemployed doesn’t seem like the best way to improve and retain custome
result of this philanthropy is continued archaic manual processes and almost non-existent global
As much as banks have embraced automated ID verification, document verification is still a burnin
area of focus in the new Bank Secrecy Act (BSA). Along with the focus on Ultimate Beneficial Own
international accounts, the banking sector needs to do more with global
ID verification and digital identity management. Though some banks have made strides into digita
unfortunately, their efforts weren’t very effective. However, we can use their setbacks as the learn
banking industry.
Complex online process
Partial digitalization makes customer visits to branches necessary
A paper-based ID validation system
Failing to adhere to legal/regulatory AML compliance
Lengthy navigation platforms that may lead to a higher abandonment rate
Lack of multi-channels

4. If you have ever been to a bank recently, you can attest that there are banks still making these sa
And if you wait long enough, you’ll probably witness an employee skipping elements of Know Yo
speed up the process. As much as banks don’t want to admit that dirty secret, it happens because
Humans get tired, hungry, and have problems and needs. We may not want to face the reality tha
is a threat to digital customer onboarding, but we have to address it. Because it is in the human fa
setbacks arise.
Banks may not have provided sufficient KYC training or oversight.
HR was ill-equipped to hire cybersecurity, marketing, and digital experience professionals.
Bank executive management didn’t make proper use of consumer data for customer onboardi
Or it can simply be Johnny Teller just not doing their job as they are supposed to.
Whatever the deep cause behind these early failures, as a whole the banking industry must take
Instead of treating them as failed customer onboarding solutions, pinpoint where the client onboa
and address potential gaps in the process and its implementation. Note, the client onboarding pro
hundred times and be the most advanced ID validation system on the planet, but if the implemen
then those deep-seated concerns need to be addressed first in the house.
Benefits of Improving Digital Onboarding Solutions

5. All customers will thank you
Though there still are the rare birds who love visiting their favorite bank representative to chat. Mo
community wants that home delivery service treatment from their banks that they could get ever
the customer gives you money, why shouldn’t they get the service they deserve.
In all seriousness, improvements in customer onboarding as a whole should have been made bef
when performing in-house tasks, the client onboarding process wasn’t completely standardized.
confirmation when dealing with high-risk clients, but what exactly were some banks’ criteria for d
Again, we go back to human error and biases which opened the door for fraud and money launde
Digital onboarding reduces the potential for human error, bias and improves customer safety and
potential outcome of a smaller workforce, it also means better accountability. Supporting actors o
will now have fewer people and untraceable actions to hide behind. More benefits of improved di
onboarding solutions are:-
Reduced Operating Costs
Going paperless for years has the theme of being environmentally conscious, but most businesse
of lower operating costs. It’s the biggest win for both customers and the banks. Aside from the ob
protection bonus, it also reduces the need for customers to walk around with files of documents f
transaction.

6. Transparency in Operations
Digitalization will automatically standardize key aspects of online KYC verification and reduce inci
and errors. A reduced paper trail doesn’t mean complex online procedures. Machine learning-pow
guided AI would still have the final say in processes like online KYC verification and each change
recorded. Therefore, there are fewer chances for chicanery.
Stricter Adherence to AML Compliance Regulations
As of late 2020, there were banks and financial institutions that were still not AML compliant and f
Repeat offenders seem to have disregarded any interest in AML compliance. Standardized digital
with stringent oversight can put a dent in their unsafe and illegal practices while improving custom
employee protection.
Better Digital Identity Security and Management
Cyberthreats are a major concern for not only the financial industry but the global economy as we
the banking sector is a matter of importance to all banking and non-banking citizens. Priority mus
secure digital identity security systems and restricted databases that require verified identity pass
Improved Customer Onboarding

7. Imagine 24-hour banking without limits! It is possible and though some banks offer 24-hour acces
of in-house visits to finish your transaction. Also, some of these online processes are longer than v
Creating better digital customer onboarding solutions should cut back on lengthy sign-ups, meet
verification requirements and improve customers’ control over their account access.
Designing Client-Centric Digital Customer Onboarding
Keeping the focus on a frictionless customer experience is a smart start in designing client-centri
onboarding solutions. Walking a mile in the customers’ shoes allows banks to better understand w
goes through when using their services.
Yet in early adaptations, banks eschewed this idea and designed the digital onboarding process w
organizational operations in mind. Thereby creating the incomplete and inefficient client onboardi
today.
To fully correct these issues in digital onboarding, banks have to be prepared to make drastic cha
operations, human resources, digital identity management systems, and what’s considered real-t
verification.
There must be an open-minded approach to technology, education, and making organizational c
client-centric digital customer onboarding solutions is easy with the right technical expertise and
be just as easy with an ID validation system from IDMERIT.

8.
Here is how IDMERIT’s IDMkyX platform can be a part of
centric digital customer onboarding solutions:
Automated ID Verification in Digital Onboarding
Going digital does not mean emulating the traditional onboarding processes in a digital platform.
the lengthy, complicated paper-based forms in a web or mobile interface. To apply a customer-ce
approach keep everything short, simple, and easy to use.
Keep the whole client onboarding process under 5 minutes.
Limit questions to a minimum and avoid repetition
Inform customers why data is required and how it is used to gain their confidence
Introduce Smart e-Forms with guided-snippet based flow, supported by automation of IDMaut
data entry
Automated information saving functionality to give customers the option to drop out in the mid
and restart at their convenience.
Standardized AML Compliance for B2B Client Onboarding Process

9. The basics of digital customer onboarding in the banking sector need to be overhauled. In this gig
client onboarding checklists should account for enhanced due diligence as part of B2B KYC requ
B2B client onboarding can be harder to correct and address once the damage is done.
Naturally, B2B clients have a longer onboarding cycle which leads to greater frustration for all par
leadership roles, AML compliance requirements, and laissez-faire attitudes towards UBO’s always
losers when it comes to B2B client onboarding. Start with a conversation using IDMlive to discuss
with your B2B client.
Start with a financial advisor for business development. New or old, discuss future goals
Understand the business organizational structure and be prepared for signee changes
Discuss the legalities of the business structure and AML compliance requirements
Use independent oversight in all document verification and global ID verification
Take the necessary steps to assess risk with IDMtrust which doesn’t need their Personally Iden
(PII) to check their risk score.
Do regular financial check-ups to stay up-to-date on B2B client changes and reduce repeat re
Mobile ID Verification With An Integrated Omni-channel Experience
Mobile phones aren’t the only tools banks need to use in their quest for a more multi-channel
laptops make that list as well. Anything with a screen can be used by customers to access their a
with your service.

10. Neglecting mobile ID verification when at 55% mobile has the highest market share of digital d
counterproductive.
Introduce self-service models across multiple platforms to empower customers towards quick
specific problems
Mobile optimized ID validation and document verification for instant submission and automate
Validate ID anywhere by using IDMsocial for online ID verification through social media
Include smartphone biometrics into mobile ID verification
Increase Global Collaboration for Powerful Digital Identity Security
Cybersecurity cannot be overlooked in a discussion about online ID verification, global ID verificat
management. Global collaboration between government regulators, corporations and the bankin
solid support system for digital identity security systems. By increasing communication and share
can have a stronger foothold on organized crime and money laundering.
Performing an automated global ID verification by online ID verification from any national ID da
Using modern technology such as IDMdevice to verify device used and validate ID
Access to all up-dated global watchlists
Improved AML compliance checks
Integration with the credit bureau for document verification and to validate an ID
Embrace the Power of Data and Analytics in Digital Identity Management

11. Maybe banking heads needed to do more robust research when it came to finding out exactly wh
preferences are. Current systems reflect a certain disconnect with B2C customers and too much fl
clients.
Paying attention to the data makes segmentation and engagement easier. It allows banks to unde
and how their customers are interacting with them and should be the basis of which any client-ce
onboarding process.
Require a verified identity pass for data access. It could be a biometric scan or any unique person
Include governmental or independent oversight in digital identity management
Adhere to BSA/AML compliance standards for personnel management which includes robust tra
oversight
Use consumer transaction records and behavior in the fight against fraud and money laundering
Closing
Though the pandemic and AML policies have accelerated the pace of digitalization pushing bank
traditional boundaries, it doesn’t mean the industry was unprepared. Cyberthreats and the rise in
banking sector on high alert to potential threats and poised to make changes. However, banks co
innovation and financial service offerings that offered the same level of service in the traditional se
environment.

12. As great as this step was for digital services, banks didn’t truly leap full digital onboarding solution
many customers, it seems a little too late and not wholly customer-centric.
Major issues like mobile ID verification, global ID verification using watchlists, regulatory reporting
employee online KYC verification training, were not embraced as necessary to an efficient client o
Implementation seems to be the main culprit behind these onboarding failures and AML non-com
Therefore, for the good of the banking sector and its customers, perhaps it would be best if digita
management and security were left to the professionals.
That way, banks can still provide a versatile customer onboarding experience, reduce the risk of f
anywhere with the backing of IDMERIT’s IDMkyX platform.
Contact us today for a client-centric solution to digital onboarding.