Sharing data to collectively improve consistency, efficiency and speed of KYC processes
It’s a huge challenge for financial institutions to keep up with ever-changing global KYC regulation – and a delicate balancing act to ensure effectiveness, manage costs and use resources efficiently. Banks are expected to ensure that due diligence on their correspondents is thorough, timely and accurate – and The KYC Registry is helping to make this much easier for them to achieve.
Cutting through the complexity
As the banking partner of the world’s most sophisticated and complex financial institutions, J.P. Morgan receives a large volume of KYC requests. “Meeting our compliance obligations while providing an excellent client experience is a business imperative,” explains Holly Johnson Stuhr, the bank’s global lead for KYC.
J.P. Morgan decided to allocate a dedicated group to managing KYC requests. Central to this exercise was to investigate using industry utilities to handle KYC data more efficiently – and they opted for SWIFT’s KYC Registry, so they could start centralising KYC requests. Holly Johnson Stuhr says they noticed the benefits immediately – in particular greater operational efficiency and the exchange of data that meets SWIFT standards.
As one of the founding members of SWIFT’s KYC Registry, it made sense for us to use the platform and share our standardised set of data and documents with other banks.
Having made significant progress in centralising inbound KYC requests at J.P. Morgan, and seen tangible benefits, Holly Johnson Stuhr’s advice to other banks is clear: “Just start publishing [your KYC data]. It promotes your institution’s transparency around its AML programme.”
HSBC began using SWIFT’s KYC Registry to streamline processes and quickly started seeing benefits.
By using The Registry, HSBC is now making its KYC processes more efficient, speeding up onboarding and enhancing customer service for its correspondent banking clients.
From eliminating hours of research to empowering counterparties to make self-service requests, The Registry has helped deliver improvements in consistency, efficiency and speed. “Where The Registry really adds value is by enabling us to look at the risk holistically, rather than spending time collecting information from multiple sources,” says Gary McClure, the bank’s head of KYC operations.
With the expansion of the Registry’s data ‘baseline’ to enhance the scope and breadth of information, and a growing number of banks contributing data, HSBC expects to see further cost and efficiency gains.
The KYC Registry baseline v.2.0 covers more than 90% of our current KYC requirements. We expect to see significant cost savings over and above the existing efficiency gains.
“I don’t think there is a more effective way of getting information about correspondent banks,” sums up Gary McClure. “For us, it’s the go-to place for getting the right level of information about our counterparties for AML purposes.”