{"id":118605,"date":"2023-02-01T15:38:33","date_gmt":"2023-02-01T15:38:33","guid":{"rendered":"https:\/\/feedzai.com\/?p=118605"},"modified":"2024-04-09T09:14:02","modified_gmt":"2024-04-09T09:14:02","slug":"a-banks-guide-to-getting-started-with-pkyc","status":"publish","type":"post","link":"https:\/\/feedzai.com\/blog\/a-banks-guide-to-getting-started-with-pkyc\/","title":{"rendered":"A Bank\u2019s Guide to Getting Started with pKYC"},"content":{"rendered":"
[vc_row row_height_percent=”0″ override_padding=”yes” h_padding=”2″ top_padding=”1″ bottom_padding=”2″ overlay_alpha=”50″ gutter_size=”3″ column_width_percent=”100″ shift_y=”0″ z_index=”0″][vc_column width=”1\/1″][vc_row_inner][vc_column_inner width=”1\/12″][\/vc_column_inner][vc_column_inner width=”10\/12″][vc_single_image media=”118619″ dynamic=”yes” media_width_percent=”100″ uncode_shortcode_id=”143850″][\/vc_column_inner][vc_column_inner width=”1\/12″][\/vc_column_inner][\/vc_row_inner][vc_row_inner][vc_column_inner column_width_percent=”100″ gutter_size=”3″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_visibility=”yes” mobile_width=”0″ width=”2\/12″][\/vc_column_inner][vc_column_inner width=”8\/12″][vc_custom_heading heading_semantic=”h3″ text_size=”h3″ text_weight=”400″ uncode_shortcode_id=”809851″]It’s no secret that the traditional methods for Know Your Customer (KYC) and Customer Due Diligence (CDD)<\/a> used by many banks and financial institutions are in need of an upgrade. In an age where information is rapidly shifting, KYC regulatory requirements need to move to a digital operating model. Perpetual KYC (pKYC) provides the blueprint financial institutions need to evolve. Better still, with pKYC banks can follow at their own pace.\u00a0\u00a0<\/span>[\/vc_custom_heading][vc_column_text uncode_shortcode_id=”499154″]<\/p>\n Banks have a regulatory obligation to perform due diligence and assess their customers for Anti-Money Laundering (AML) risks. This assessment is based on the bank\u2019s AML policy and risk rating vectors. Screening customers against government sanctions watchlists is a central component of the risk assessment process. These watchlists continually change, but 2022 could be a record for the number of sanction watchlist changes that banks had to deal with.\u00a0<\/span><\/p>\n This vast number of changes was due to Russia\u2019s invasion of Ukraine. The international community responded to the invasion with a litany of sanctions. Targets included members of the Russian government, oligarchs, banks, and even Russian president Vladimir Putin\u2019s <\/span>alleged mistress<\/span><\/a>.\u00a0<\/span><\/p>\n As the conflict rages on, the list of targets has only grown more expansive. New names and entities of sanctioned individuals, politically exposed persons (PEPs), and relatives and close associates (RCAs) are constantly added to watchlists.\u00a0<\/span>[\/vc_column_text][vc_single_image media=”118706″ media_width_percent=”100″ uncode_shortcode_id=”265675″ el_class=”hide-in-mobile”][vc_single_image media=”118727″ media_width_percent=”100″ uncode_shortcode_id=”167842″ el_class=”hide-in-desktop-tablet”][vc_column_text uncode_shortcode_id=”153370″]And as we know, a watchlist match directly impacts the KYC\/CDD risk vector profile. Frankly, how do you keep up with these changes if KYC\/CDD is still beholden to traditional methods?\u00a0\u00a0<\/span><\/p>\n Clearly, banks need to embrace change. But the good news is these changes don\u2019t have to happen all at once.<\/span><\/p>\n A dated KYC\/CDD operational model leaves banks vulnerable to errors. For example, a customer who was considered low-risk at the time of onboarding could see their risk level change in between scheduled reviews. This change could result from transaction activities, opening a new account, or adding a risky signatory.\u00a0<\/span><\/p>\n2022: A year of relentless change for financial institutions<\/span><\/h3>\n
Embracing pKYC is a Journey, Not a Sprint for Banks<\/span><\/h3>\n