For corporate treasurers around the world, the need to repeatedly provide banks with information for mandatory Know Your Customer (KYC) checks continues to be a huge cause of frustration and inefficiency. Corporates often have multiple banking partners across numerous jurisdictions, each with their own unique KYC process for onboarding new customers.
According to research in a recent Eurofinance whitepaper, this lack of standardisation when it comes to compliance checks is a significant deterrent for corporates, with over 50% reporting that they would reduce the number of banks they work with just to avoid lengthy KYC processes.
SWIFT’s KYC Registry
Initially created for the banking community in an effort to streamline the global payments compliance process, SWIFT’s KYC Registry was designed with a simple idea at its core - eliminate the need to repeatedly provide KYC data every time a new customer is onboarded or recertified. Instead, users are able to upload the majority of their KYC information to the registry, and can then grant other banks access to complete a check.
Today, more than 6,000 banks around the world benefit from using the KYC Registry. One year ago, to also help corporates overcome the challenges associated with KYC checks, SIWFT opened the registry’s doors to those corporates on its network.
"The banking community has embraced the registry and we’re really pleased with the response from our corporate customers too," says Delphine Masquelier, product manager in KYC Compliance Services at SWIFT. "It’s been fantastic to watch it grow and even exceed our expectations. We’ve been working with 15 banks to determine corporate requirements and ensure they can easily use the registry, and are proud to say that over 50 banking groups are now using it with their corporate customers."
At the moment, around 80% of the required information for KYC checks can be stored on the registry, meaning that onboarded corporates no longer have to repeatedly upload the same documents for each of their banking partners. Instead, after uploading their KYC information, all that’s left to do is make sure it’s kept up to date, leaving more time to drive value in other business areas.
"Banks, like corporates, have to respond to KYC requests for data and documents on our legal entities," says Mark Trivedi, MD of Client Experience Operations Transformations at J.P. Morgan. "Using SWIFT’s KYC Registry for the bulk of this content has allowed our internal teams to focus on the residual portions of requests and other activities. As corporates leverage the registry, they can leverage the platform’s potential to increase their own teams’ efficiency too."
Digital solutions in the age of the pandemic
While the compliance industry was already shifting towards digital solutions, the coronavirus pandemic has reinforced the value of tools like SWIFT’s KYC Registry. Businesses and financial institutions are constantly having to adapt their operations and offerings as the pandemic unfolds, but tools that leverage digitisation, like the registry, have the potential to make life significantly easier for compliance professionals - alleviating some of the burden of KYC checks.
"The pandemic has caused us to reassess the way we work in a lot of different areas," says Andre Duesterhus, head of Regulatory Client Management Germany at Deutsche Bank. "But fortunately using the registry within correspondent banking and with our corporate customers means that performing these compliance checks has remained a simple process for us. While some corporate treasurers are already using SWIFT’s KYC Registry, others have had to navigate new compliance workflows without realising they can benefit from it in the same way."
A future proof solution
Fulfilling compliance checks is an essential part of maintaining the integrity of the global financial system, but there’s no doubt completing them can be time-consuming. SWIFT's dedicated registry onboarding team aims to make the move towards digital KYC processes easy for any corporate customer on the SWIFT network. The cooperative says it is committed to helping corporates and banks work as efficiently as possible by providing solutions like this.
"This really is a solution that lets us take care of the heavy lifting corporates are usually required to do themselves in the KYC process," concludes Masquelier. "For example, when we onboard a new corporate customer, our team is able to populate the majority of the mandatory fields using the information they provide - saving them time from the very beginning. Understandably, some corporates have been reluctant to adopt new compliance solutions for fear that they won’t stand the test of time. That’s not the case with our KYC Registry, which is backed by the SWIFT community and will continue to evolve to make compliance checks more efficient. As a corporate, you can have peace of mind that signing up to the registry today will continue to benefit you in the future."
There are currently more than 50 banking groups using SWIFT’s KYC Registry with their corporate customers to streamline their compliance processes, including Deutsche Bank, BNP Paribas, Credit Agricole, HSBC, Intesa San Paolo, JPMorgan Chase, Santander, Societe Generale and UniCredit - all of which are actively working towards the success of the initiative.
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