The KYC Exchange Net AG (KEN) has signed service contracts with Commerzbank, Société Générale and Standard Chartered for the regular exchange of Know Your Customer data between the banks and their clients. Launched in January 2014 to help firms meet the anti-money laundering (AML) and KYC rules by providing a platform that allows for the cost-effective exchange of KYC data between regulated financial institutions (FIs), such as banks, and their clients. KEN’s positioning statement is: ‘Setting the Standard as the first secure communication platform for Know Your Customer (KYC) and Customer Due Diligence (CDD) purposes for the Financial Industry.’

New member

Emmanuel de Bouard, managing director cash clearing services at Société Générale, says of the decision to sign up with KYC Exchange: "While there are many solutions being developed around KYC, we really value the fact that the KEN platform of KYC Exchange Net AG is already available. They entered the market at exactly the right time and we were involved at a very early point in the development. As a result of the successful testing phase, the next logical step was to sign a contract with the team of KYC Exchange Net AG."

Business model

Banks pay a fee for the exchange of KYC information through the Web-based Software-as-a-service platform, which does not require any investment in terminals, special software or frequent system maintenance. The exchange of KYC data with a selected partner takes less than one minute and any update of previously shared KYC information is automatically forwarded to all previous recipients in real time.

Implementation

Early user DZ Bank says that it requires some effort to complete the relevant templates and upload the correct data sets, but it is worth it. DZ has just started to send KYC data to its first partner banks. 

Competition

KYC Exchange is competing with several other utilities from SWIFT, Thomson Reuters, Markit | Genpact KYC Service, and IdenTrust. The race is on to sign banks before they commit to other services. 

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CTMfile take: BUT, and it is a BIG BUT, will the corporates provide their data to these exchanges? We’ll see.