Financial Crime World

BANKS SAVE 20% ON KYC OPERATIONS WITH FOCUS ON LOW-RISK CUSTOMERS

Optimizing Know Your Customer (KYC) Operations for Cost Savings and Efficiency

A leading global bank has achieved a significant reduction in operating costs by updating its Know Your Customer (KYC) information on low-risk customers only when certain trigger events occur, rather than following a set calendar schedule. This innovative approach has resulted in a 20% decrease in the number of cases requiring customer outreach, from five to one or two.

Streamlining Operations for Greater Efficiency

By streamlining and automating processes, operations teams are expected to increase their capacity by 30-35%. The bank’s success is attributed to a combination of technological and human elements, including:

Key Factors in the Bank’s Success

  • Risk-driven design: Focusing on customer risk assessments to drive policy development and process design.
  • Digitization: Implementing a self-service customer portal that tailors requirements and employs a customer-service team with global and local KYC knowledge.
  • Data analytics: Leveraging automatic and dynamic data feeds from external and internal sources to conduct advanced KYC-program-risk analytics.
  • Process automation: Automating case management, workflows, and policy management to improve capacity and allow teams to focus on value-adding activities.
  • Center of excellence: Building a center of excellence with robust performance management that includes customer-experience metrics in every step of the process.

Key Takeaways

Adopting a Targeted Approach to KYC Updates

The bank’s efforts demonstrate that by adopting a targeted approach to KYC updates, financial institutions can reduce costs and improve operational efficiency without compromising on risk management or customer experience. The key takeaways from this success story are:

  • A risk-driven approach to KYC can lead to significant cost savings and improved operational efficiency.
  • Focusing on low-risk customers only when specific trigger events occur can minimize unnecessary workload.
  • Implementing a combination of technological and human elements is crucial for achieving success in optimizing KYC programs.