Guide to KYC Solutions and Compliance

Know Your Customer (KYC) regulations and processes are critical to ensuring safe and compliant interaction between financial institutions and their customers. These regulations not only protect businesses and individuals from financial crime, but they also establish trust and transparency in a competitive market.

By focusing on robust KYC solutions, organisations can safeguard themselves against risks like identity fraud, money laundering, and other financial crimes.

This guide provides an in-depth look at KYC solutions, covering essential processes, requirements, and the role of automation in a rapidly evolving field.

‍What is KYC

Know Your Customer, better known by its acronym KYC, is a regulatory standard implemented globally to verify the identity of customers, assess their risk, and monitor their ongoing activity.

Initially popularised within the banking sector, KYC has become a crucial compliance measure across financial services, insurance, gambling, ecommerce, and beyond.

The key goal of KYC is to confirm that the person trying to open an account is who they say they are, and this can be broken down into three key areas:

• Customer identification and verification: Verifying the identity of each customer to prevent fraud.
• Customer Due Diligence (CDD): Conducting in-depth analysing of each customer’s background to assess risk. Enhanced Due Diligence (EDD) can also be deployed dependent on level of customer risk.
• Ongoing monitoring: Continuously tracking customer activity to identify unusual or suspicious transactions.

The components collectively create a secure and transparent financial environment, deterring financial crime and ensuring compliance with regional and global regulatory requirements.

KYC Solutions: Identification, CDD, and Ongoing Monitoring

KYC solutions consist of several interconnected processes designed to authenticate and monitor customer information accurately. Here’s an overview of the main KYC solutions:

Identification and Verification

This is a foundational step in the KYC process, consisting of collecting legal name, address, and / or government issued ID, to ensure that the person is who they claim to be. Reliable identity verification methods protect against theft and fraud.

‍Customer Due Diligence (CDD)

This process follows directly from identification and verification and with the addition of automated solutions, both processes can be done in tandem. During CDD, businesses will assess customer risk through a deeper analysis of their financial background and risk profile. CDD ensures that high-risk customers are identified early, allowing organisations to apply additional scrutiny including Enhanced Due Diligence (EDD) as needed.

Ongoing Monitoring

Sometimes referred to as perpetual KYC, ongoing monitoring is a continuous process of observing and analysis customer activity. By identifying unusual behaviours through services such as transaction monitoring or being notified of any changes to customer risk including becoming a PEP, sanctioned, or new adverse media, businesses can address potential risks proactively.

‍What are KYC Requirements & Regulations?

KYC requirements are detailed guidelines set by regulatory authorities to ensure customer verification and Anti-Money Laundering (AML) compliance. While these standards are designed to reduce financial crime, specific requirements vary widely depending on the sector, jurisdiction, and regulatory body involved.

Sector specific regulations

Financial institutions, gambling operators, insurance firms, and payment providers are often subject to stringent KYC requirements due to their vulnerability to financial crime, fraud, and money laundering. Regulations including the UK Gambling Act, The Consumer Duty, and the 6^thAnti-Money Laundering Directive are designed to regulate industries specifically.

‍Multi-jurisdictional complexity

KYC for banks and other global financial institutions becomes more complex in multi-jurisdictional setting, where each country’s regulations may vary. For example, while the US primarily follows the Bank Secrecy Act (BSA), the EU, as mentioned, has its Anti-Money Laundering Directives (AMLD) and other guidelines. Harmonising processes to comply with nuances in regulation requires meticulous planning and often the assistance of KYC software tools.

Ongoing adaptations

As financial crime evolves, regulatory requirements are set to adapt and become more stringent to maintain security. Regulated entities are expected to stay updated on regulatory changes, ensuring that their KYC processes meet all current compliance needs.

The Future of KYC

The future of KYC will likely be defined by automation, artificial intelligence, and blockchain technology, which are reshaping how businesses do compliance. These advancements promise to enhance the efficiency and accuracy of the KYC process.

1. Automated Id Identification and Verification: Automation allows for faster and more accurate customer identification, reducing the manual workload on compliance teams. It also minimises human error and accelerates onboarding, enhancing the customer experience.
2. AI and Machine Learning: AI technologies can analyse customer data at scale, identifying patterns and anomalies in real time. This capability strengthens the ongoing monitoring process by predicting suspicious activity before it escalates.
3. Blockchain for Enhanced Transparency: Blockchain technology enables secure and tamper-proof record-keeping, which could significantly reduce fraud and enhance trust in identity verification.

Using KYC Software and Automation Tools  

Adopting KYC software solutions can simplify compliance by automating key components of the KYC process. Today’s solutions offer a range of capabilities, including automated identity verification, customer information management, and regulatory reporting.

Benefits of KYC Software:‍

• ‍Increased Efficiency: Automation tools streamline the KYC process, allowing for quicker customer verification and onboarding.‍
• Reduced Compliance Costs: By minimising the manual workload, businesses can reduce operational costs and allocate resources to higher-value tasks.‍
• Enhanced Accuracy and Reporting: Automation tools ensure compliance by staying updated with regulatory changes, thereby reducing the risk of human error.

Examples of KYC Software Capabilities:‍

• ‍Perpetual KYC: Automatically updating customer records to reflect any changes in risk status.‍
• Comprehensive Documentation Management: Safely storing and managing KYC documents for audit purposes.

‍Get Started with FullCircl KYC Solutions

For businesses seeking to protect themselves from financial crime and ensure regulatory compliance, adopting a robust KYC solution is essential. FullCircl offers a comprehensive suite of IDV solutions designed to simplify customer identification, enhance customer due diligence, and maintain ongoing monitoring. With FullCircl, businesses can access cutting-edge tools that streamline the KYC process, reduce compliance costs, and enhance their ability to respond proactively to regulatory changes. Contact the team here to find out more.

Want to learn more about the latest identity verification and KYC trends? Download FullCircl's State of IDV Report to prepare for 2025.

Regulation Update: New Guidance for Implementation of Companies House Reforms

The Economic Crime and Corporate Transparency Act (ECCTA) came into force 12 months ago with the aim of strengthening the UK’s efforts to combat economic crime via a wide-ranging suite of reforms.  

Importantly the Act gives Companies House new and enhanced powers to scrutinise information provided by companies and their directors, turning it from a largely passive recipient of company information to a much more active gatekeeper.  

Background to the Companies House Reforms

Companies House now has enhanced abilities to verify the identities of company directors, remove fraudulent organisations from the register, and share information with criminal investigation agencies.  

This will serve to drive greater trust in UK companies both domestically and internationally.  The primary benefits of more accurate and reliable information in the register are that companies can better assess the risks posed by potential customers, business partners and suppliers, and reduce the incidence of fraud, money laundering and other types of financial crime.

However, some have viewed the reforms as a burden both in times of cost and resource, in particular the increased reporting requirements around beneficial ownership and identity verification of directors, shareholders, persons with significant control, and other agents.

Companies House has published a transition plan to assist companies in preparing for the changes. It outlines the timeline for the commencement of key provisions of the Economic Crime and Corporate Transparency Act 2023 (ECCTA 2023).

‍Outline plan for phased implementation of Companies House reforms

By the end of 2024/early 2025 Companies House will be able to:

• Issue financial penalties for any relevant offences under the new Act and the Companies Act
• Expedite the striking off of companies where the registrar has concluded the company has been formed for a false basis
• Annotate the register in a wider range of circumstances, such as when a company has a director who has been disqualified but has yet to terminate their appointment on the register, or where Companies House has issued a statutory notice to require more information from a person, but the matter remains unresolved

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Spring/Summer2025 this will be expanded so that Companies House can:

• Carry out checks on Authorised Corporate Service Providers (ACSPs) to authorise them to carry out verification services – ACSPs will be required to be registered in the UK and be subject to the UK’s anti-money laundering regime
• Allow individuals to voluntarily verify their identity
• Receive and assess applications from individuals seeking to have residential addresses suppressed from public disclosure in certain circumstances
• Allow access on request to certain trust information on the Register of Overseas Entities

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Then by autumn 2025 Companies House should be able to:

• Make identity verification a compulsory part of incorporation and new appointments for new directors and PSCs
• Begin the 12-month transition phase to require more than 7 million existing directors and PSCs to verify their identity – the identity verification will happen as part of the annual confirmation statement filing

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During 2026 a range of phased changes should empower Companies House to:

• Make identity verification of the presenters a compulsory part of filing any document
• Require third party agents filing on behalf of companies to be registered as an ACSP
• Reject documents delivered by disqualified directors as they will be prohibited from doing so, unless they are delivered by an ACSP for specified filings permitted by law
• Require all limited partnerships to submit more information, providing greater transparency for users of the register
• Complete the transition period for all individuals on the register requiring identity verification, and start compliance activity against those who have failed to verify their identity
• Facilitate greater cross-checking of information and data between Companies House and other public and private sector bodies

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The full plan can be found here.

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If you have questions about the Companies House reforms or the potential impact of the Economic Crime and Corporate Transparency Act, as well as how to stay ahead of implementation get in touch with a member of our team today.

As I write this, I find myself reflecting on the remarkable journey we’ve all been on. When Mike, Steve, and I founded the company, nearly two decades ago, we named our company Artesian, after a certain type of well that draws water from the ground using natural forces. We wanted to automate the extraction of value in much the same way, albeit from unstructured data from the web, social media and the news (when digital news was just getting going). What started as a business intelligence platform aimed at transforming how companies leveraged insights to have better conversations every day, became a platform that facilitates better decisions every day, something much bigger than we could have ever imagined.

A few years ago, we took a bold step acquiring and joining forces with Justin Fitzpatrick and the team at DueDil, pioneers in company intelligence and KYB. This move not only brought invaluable talent and technology into our fold, but it also set the stage for our rebrand to FullCircl - a name that embodies our mission to create a truly end-to-end customer lifecycle platform. More recently, the acquisition of W2 Global Data Solutions, working with Warren Russell and team, leaders in KYC and AML compliance, helped us strengthen our capabilities with the addition of onboarding orchestration, giving regulated companies a complete toolkit to identify, acquire, verify, onboard, and monitor customers seamlessly.

Today, I’m incredibly excited to announce another milestone in our journey: FullCircl is now part of nCino. This acquisition marks a pivotal moment for our company, and it’s an opportunity, I believe, will benefit every customer, employee, and partner.

Why nCino?

For those who may not know, nCino is the leading provider of intelligent, best-in-class banking solutions, providing financial institutions with a comprehensive platform that brings together people and data and enables financial institutions to enhance strategic decision-making, risk management, and customer satisfaction. Our relationship with nCino has been building since we formally partnered in 2023, working together to integrate FullCircl’s capabilities into their intelligent platform. During this time, it became clear that our combined strengths could offer something truly special to the financial services community.

Our shared customers - including some of the UK's leading financial institutions and innovative digital banks - are already seeing the benefits of this collaboration. By joining forces with nCino, we are now positioned to deliver even greater value, expanding the reach of FullCircl’s frontline, onboarding, due diligence, and risk monitoring capabilities across Europe.

What This Means for You, Our Customers

As a FullCircl customer, you can look forward to significant enhancements in the services we provide. Our powerful business-rules engine, developed through years of collaboration and input from industry pioneers, will be part of a global platform that simplifies the complexity of onboarding while helping to ensure regulatory compliance. Imagine faster onboarding, integrated workflows, and access to real-time business data - all within a single system of record that streamlines your entire customer lifecycle, from acquisition to ongoing monitoring.

The joint proposition between nCino and FullCircl is about more than just software integration; it's about transforming how you engage with your customers. Together, we will offer a solution that not only makes compliance easier but drives profitability and growth for your business.

For the financial institutions we share with nCino, this acquisition enhances our combined capabilities and empowers your teams with even more tools to serve your customers better, faster, and with greater transparency. The FullCircl platform will now be complemented by nCino’s global reach and resources, making it possible for us to deliver even more value to your business.

We remain deeply committed to serving our non-financial businesses across various industries including insurance, gaming tech and telco. Many of you have leveraged FullCircl's capabilities to enhance business development efforts, reduce risk exposure and understand your customers and markets in your own unique contexts. Rest assured, these offerings will continue to be an integral part of our solution portfolio, and we will maintain our focus on helping all our clients - whether financial or non-financial - achieve their growth and compliance goals.

A Message to Our Team

To the entire FullCircl team, I want to extend my deepest gratitude for your dedication, sacrifice and focus. From the early days of Artesian to the strategic acquisitions of DueDil and W2 Global Data, you have been the driving force behind our success. This acquisition is a testament to everything we’ve achieved together. And now, as part of nCino, we have the opportunity to make an even bigger impact, on a global scale.

Our work is far from over - this is just the beginning of a new and exciting chapter. nCino values the innovation and expertise that each member of our team brings, and together we will continue to move forward at pace, delivering more powerful functionality for the frontline, unique onboarding capabilities, smarter compliance, and solutions that accelerate growth for our customers.

The Road Ahead

This acquisition marks an important step in our shared journey with nCino. With their support, we are ready to bring even more ideas and innovation to the table. We’ll be expanding our reach across Europe, bringing new capabilities to regulated institutions of all sizes, and continuing to push the boundaries of what’s possible in client lifecycle management. The challenges are widespread, complex, and rapidly changing, and I am personally excited about continuing to find innovative ways to help our customers solve them.

Whether you’re a long-time FullCircl customer or new to our platform, rest assured that our commitment to your success remains stronger than ever. Together with nCino, we are ready to provide you with the tools, data, and insights you need to thrive in a rapidly changing regulatory environment.

Thank you for your continued trust and support. I am, and we are, excited to enter this next phase looking forward to the challenges and opportunities that lie ahead.

--

Andrew

CEO & Co-Founder, FullCircl

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2024 is proving another standout year for the regulatory space, finding itself under the spotlight, for better and worse reasons. This month, The Fintech Times will look at some of the biggest issues regarding compliance and financial rules, as well as the solutions hoping to ease the compliance journey for firms and make the fintech world fairer and safer. FullCircl's Banking Success Director, Lucy Huntley, talks to the FinTech Times about the AI revolution in compliance and how it can be harnessed for growth.

Having already explored compliance challenges, penalties and solutions, we now turn our attention to the technology of the moment: AI.

While we’re well aware that AI is currently spoken about in absolutely every context, we also understand the huge impact it can have across sectors and operations. With this in mind, The Fintech Times reached out to industry experts to ask how AI will leave its mark on compliance for the fintech industry. Read the original FinTech Times article here.

AI promises ‘massive impact’ on compliance efficiency

Now is hardly the very beginning of AI supporting compliance processes, explains Lucy Huntley, banking success director at FullCircl. However, its potential impact on the space is yet to be fulfilled.

“In many respects, AI has been playing a significant role in automating compliance processes for a long-time now. AI has already transformed compliance processes in the fintech industry by making them faster, more accurate and more efficient. With AI, tasks including regulatory reporting and disclosure, data analysis, and risk assessments can be automated, saving time whilst also reducing errors and improving the customer experience, particularly at the onboarding stage.

“Likewise, machine learning algorithms continuously learn from data, improving accuracy over time. This means compliance teams can focus on more strategic tasks, while AI will always look to keep the company compliant!

“Looking to the future AI will have a massive impact on improving automation processes around document verification. Computer Vision (CV) for example is an emerging field of AI which enables a much deeper level of accuracy when cross-referencing the biometrics of a live selfie with a portrait on an ID document.”

“AI adoption in compliance is still in its early days, but is rapidly picking up speed,” explains Paul Cottee, director of compliance SME at NICE Actimize. “Currently, the adoption of AI centres around assisting with often mundane tasks: that is, for example, using a large language model to help speed up written tasks such as reports and filings; using AI to help score and prioritise surveillance alerts; and looking for patterns and relationships across large volumes of unstructured data.

“This is increasing the efficiency of the compliance function, both in terms of monitoring and supervisory activities, and also in administrative work, leaving the compliance officers with more time to devote to tasks requiring human judgment and decision-making.”

Saving compliance teams time

Hilary Wandall, chief ethics and compliance officer at business intelligence and data firm Dun & Bradstreet, also echoes this sentiment. She explains while AI can streamline compliance processes and save compliance teams time to spend elsewhere, firms need to be careful about how they implement it.

“AI is beginning to play a pivotal role in streamlining certain regulatory compliance processes within the fintech industry. The emergence of AI and ML tools has enabled companies to analyse vast amounts of data in real time, detecting patterns that indicate potential compliance risks, such as money laundering, sanctions, or fraud.

“This improves customer due diligence by concurrently cross-referencing many databases to verify identities with potential clients and any risks associated with them. The impact is profound, as AI-driven automation reduces costs, minimises human error, and enhances the speed and accuracy of compliance tasks. As compliance teams face increasing workloads due to new regulations, automation tools allow them to focus on more complex or ambiguous cases.

“However, the effectiveness of AI models primarily hinges on a business’s robust understanding of its data estate and the implementation of an adequate data governance system. AI is only as smart as the data that fuels it, making it imperative to introduce policies and adhere to data quality standards. Incorporating high-quality, comprehensive data enables teams to assess risk more accurately and make informed decisions, leading to proactive risk management and fostering innovation and competitive advantage in the industry.”

Assessing the risk

For Steve Bradford, senior vice president of EMEA at SailPoint, firms planning to implement AI into their compliance processes must be willing to ensure they have the correct amount of oversight on its use, as well as safeguard data to a high level.

“Fintechs should put risk analysis processes in place to help ensure regulatory compliance and prevent situations that could lead to fraud or data leakage. Through a unified, AI-enabled approach to identity security, organisations can ensure that staff have only as much access as is required to perform their assigned roles and responsibilities – no more, no less.

“Using AI speeds and streamlines identity decisions, something crucial given the pace at which businesses – and cyber threats – are evolving. This enables security teams to move faster and more effectively to spot and stop unnecessary, inappropriate, or potentially compromised access.

“Safeguarding data is business critical. With the stakes higher than ever before, fintechs must make full use of the available AI-driven tools and technology to gain better visibility and insight into the specific risks associated with user access. A carefully considered approach to identity security, with stringent policies on how access to data is managed and controlled, will help businesses keep compliant as well as stay one step ahead of cybercrime.”

Saving time and money

Bronwyn Boyle, CISO at PPRO, explains how the use of AI could save not only resource, but also reduce costs – although warns that this isn’t guaranteed: “AI is bringing multiple benefits to the fintech industry by automating compliance processes.

“Real-time monitoring of transactions and activities dramatically improves the time to detect potential compliance, security, or fraud issues, while machine learning enhances the ‘signal to noise’ ratio by correlating data points across multiple sources and reducing false positives.

“AI can help businesses save time, allowing fintechs to pool resources toward innovation and growth initiatives instead.

“While early cost reduction opportunities seem promising, the longer-term impacts on cloud computing costs and ESG footprints are yet to be fully understood. However, at this stage, businesses are expected to hire in new areas like AI management and compliance to ensure the technology is being used appropriately and in accordance with regulations.”

Streamlining processes

“As more organisations implement AI for compliance, one thing we are seeing is a reappraisal of the risk management process and the role of the compliance team,” explains Joel Lange, EVP and general manager for Dow Jones Risk & Research.

“Research is time-intensive and expensive, but with AI, processes such as negative news screening can be conducted more quickly than ever before. This means that compliance can be accelerated within the decision-making workflow, enabling organisations to assess at the very beginning of a potential relationship whether it should be pursued or not.

“This avoids the wider organisation wasting time and effort into developing a business opportunity that should never have got off the ground and helps to eradicate the stereotypical view of compliance as a blocker on activity.”

AI’s growing role in compliance

Finally, Gabriel Hopkins, CPO at Ripjar, weighs up just how influential AI could be in changing the face of compliance for fintechs: “AI is not a panacea, but it does provide some powerful tools to make lives easier.

“While much of the AI we talk about today is generative AI, established AI and ML capabilities also play an important role and teams should be careful to find the right tools for the right tasks. Historically, teams have been slow to adopt AI because of fears about predictability and explainability in a regulated setting. However, well-implemented models can have a significant difference in compliance activities, particularly when dealing with complex matching challenges.

“The potential for generative AI is even greater. Some uses are obvious. The drafting of narrative summaries for Suspicious Activity Reports (SARs) can be supported by GenAI providing seed summaries which an analyst can quickly validate and then submit.

“Maybe more exciting is the chance to reinvent how compliance tasks are performed, powering virtual analysts to achieve, and sometimes surpass, human-level accuracy. Indeed, these tools can revolutionise compliance processes and help users save up to 200 hours annually.

“Analysis has shown that a virtual analyst can help with both false positives, which are incorrect risk flags, and false negatives, which there are existing risks that haven’t been flagged – both are endemic issues caused by dealing with very high volumes of matches. GenAI can reduce these inaccuracies, significantly enhancing the efficiency and effectiveness of customer and counter-party screening.

“Compliance teams should continue to ensure that they carefully select the right AI capabilities and carefully validate the results on an initial and ongoing basis to ensure success.”

2024 is proving another standout year for the regulatory space, finding itself under the spotlight, for better and worse reasons. This month, The Fintech Times spoke to industry experts including Lucy Huntley, FullCircl's Banking Success Director, to discuss some of the biggest issues regarding compliance and financial rules, as well as the solutions hoping to ease the compliance journey for firms and make the fintech world fairer and safer. Read the original FinTech Times article here.

Kicking off our regtech focus this month, we will look to establish the biggest challenges that companies currently face when trying to ensure compliance within the fintech industry.

Regulatory rules are constantly changing, with new ones being introduced at a rapid rate. While firms are often given time to transition and adapt to these changes, a vast number of challenges remain. But what are the biggest obstacles facing firms? We asked industry experts to find out.

Keeping compliance teams on their toes

“The regulatory framework evolves constantly, and it can be challenging for compliance teams to change their operations so frequently,” explains Olympe Leflambe, general counsel, legal and compliance at Mangopay, the payment infrastructure provider. “Even with agile teams and tools, changes can be disruptive, especially when legislation hasn’t yet caught up with technology”.

But it’s not just falling foul of regulatory rules that teams need to be wary of.

Leflambe continues: “In parallel, fraudsters leverage new technology very quickly (for instance, using deepfakes to circumvent liveness checks) and compliance teams must remain very vigilant about new controls not being outdated as a result.”

A ‘double-edged sword for compliance teams’

Matthew Franzyshen, business development manager at Ascendant Technologies, a full-service IT company, explains how the rapid evolution of artificial intelligence (AI) has both positively and negatively impacted compliance.

“I think the pace with how technology is evolving is a double-edged sword for compliance teams. On one hand, these technological advancements help make the work more efficient, simple, and agile. It helps create a space where compliance teams can focus on hard-hitting issues rather than waste time on mundane work.

“However, the emergence of these technologies means that regulations to monitor their proper usage also crop up. Case in point is the wrongful usage of AI and machine learning, which poses tons of cybersecurity risks for companies. Tons of fraud and scams have come about due to these technologies, of which compliance teams need to prepare and be aware of to protect the integrity of the company. The biggest issue, though, is that new scams crop up faster than older ones are addressed. Keeping up with this can be a true headache.”

Changing state to state

For firms in the US, a fragmented regulatory landscape across states can also leave roadblocks for compliance teams to overcome explains Gale Simons-Poole, chief risk officer at BHG Financial.

“BHG occupies a distinct position in the lending landscape: we are a non-bank lender that works with banks and so we interact frequently with federal and state regulators. One of the biggest challenges that compliance teams are facing is making sure their teams are staying on top of ever-changing regulations.

“States have interests and priorities that differ from federal regulators, which makes this more challenging and even more important.

“Regulations also change every year, and it is imperative to keep a diligent eye on them, which is why BHG has built such a robust regulatory team with deep regulation and compliance expertise to ensure we’re staying on top of the shifts and that we are always in compliance.”

Preparing for DORA

Meanwhile, firms in the European Union have a different challenge to consider altogether. Guy Mettrick, industry vice president at process automation platform Appian, discusses the impact incoming regulatory rules could have.

“The Digital Operational Resilience Act (DORA) represents a huge challenge for compliance teams. The regulation, coming into force in January 2025, will add the complexity of enhanced governance across the entire supply chain. In response, compliance teams must integrate sophisticated risk management across supply networks and third-party relationships.

“Renegotiating contracts and updating service-level agreements (SLAs) within tight deadlines adds to this burden. The increased compliance complexity and costs necessitate substantial investment in technology and training. Regular resilience testing and reporting further strain resources.

“Lastly, shifting towards a centralised compliance approach requires significant organisational restructuring and adopting advanced automation and AI technologies.”

‘Headache’ over new rules

“From a data privacy and cybersecurity perspective, I think the greatest challenge for compliance teams currently is keeping abreast of all the legislation, rules and regulations applicable to their organisation,” says Sarah Pearce, partner at law firm Hunton Andrews and Kurth.

“Compliance teams have robust GDPR frameworks in place but there are a wealth of other rules and regulations applicable to those operating in the financial services sector that require additional processes and procedures to be put in place – and new rules and regulations are constantly emerging.

“In the EU for example, the NIS2 Directive, introduces a new era of EU cybersecurity legislation and must be transposed into national law of the EU Member States by October 17, 2024. Also in the EU, DORA is specifically directed at the financial services industry and is aimed at strengthening the IT security of financial entities and making sure that the financial sector in Europe is able to stay resilient in the event of a severe operational disruption.

“The rise of AI and the EU AI Act, together with other laws emerging globally provides an additional headache for fintech compliance teams given the multiple use cases likely within such organisations.

“There will be some overlap for with existing requirements and compliance teams can, to some degree, leverage existing practices and frameworks but there are undoubtedly requirements coming in that are entirely new and will require extensive additional operational implementation.”

The rising cost of compliance

For Daniel Bedford, research analyst at Juniper Research, the rising cost of compliance is one of the biggest challenges facing compliance teams.

“The floor is constantly being raised, and leaving businesses to balance regulatory obligations and financial efficiency. Compliance cost encompasses the salaries of compliance staff and their training, regulatory reporting costs, investment in technology upgrades, audit and legal fees, and the cost of implementing new regulatory guidelines and procedures.

“Rising costs are driven by different factors for every organisation, often being dependent on the industries they operate in, such as financial services or healthcare, which have more stringent reporting requirements and heavier fines. For organisations with a more global reach, operating across multiple jurisdictions will result in businesses being subject to varying regulatory regimes, which can drive up the cost of compliance significantly.

“Additionally, specific industries or jurisdictions come with varying levels of regulatory complexity, with growth of standards, laws, and other regulations, which can make compliance more complex and more costly. In order to combat these difficulties, we recommend that compliance teams invest in future-proof technology, that can provide automation and high-throughput analysis, allowing compliance teams to unlock efficiencies better manage their resources, meaning humans can intervene at the right time and avoid manual administration.”

Addressing the challenges

Finally, Lucy Huntley, banking success director at FullCircl, shares insight into how firms can begin to address these challenges, urging them to aim for a well-balanced approach to compliance.

“New rules and updates are continually being introduced, and staying on top of them is no mean feat. It’s perhaps an unspoken challenge but compliance teams are often perceived as a roadblock to the delivery of superior customer experiences and therefore growth. The reality is actually the opposite, a well-balanced approach to compliance can have a hugely beneficial impact, both reputationally and financially, with fewer cases of fraud and money laundering.

“Technology has a key transformative role to play here. A move away from manual processes and workflows towards a more dynamic tech and data-driven compliance strategy helps keep pace in a way that balances the dual challenges of stringent regulatory compliance and delivery of superior customer experiences.”

On 7^th-8^thNovember, FullCircl will join 15 handpicked technology vendors and 45 expert speakers at the 2^nd Transform Finance FinCrime Leaders’ Summit.  

As a headline sponsor of the event, we’re once again playing our part in answering the big questions currently being tackled the FinCrime community and encouraging innovation in response to the biggest challenges facing compliance and operations teams.

‍Financial Crime on the rise

The cost of financial crime is expected to hit $9.5 trillion. In the UK alone there were 1,664 recorded anti-money laundering (AML) events last year, that’s almost 2.5 events per 100,000 people. Financial institutions have reported a 64% increase in fraud attacks, with most noting that financial fraud is becoming more sophisticated, and more challenging to tackle. Likewise, according to UK government data, 55% of businesses experienced known or suspected fraud attempts last year.

This is putting huge pressure on compliance teams, especially when it comes to balancing the dual challenges of stringent regulatory compliance and delivery of superior customer experiences.

Consumer vs Compliance:  How to balance regulatory compliance with seamless customer experiences

Ben Lachenal, FullCircl’s identity solutions specialist, will take to the main stage on the first day of the event to explore how financial institutions can find the balance between compliance and conversion at a time when global KYC and AML regulation continue to evolve at pace, and customer expectations for more efficient onboarding experiences are becoming more demanding.

Joined by Daniel Holmes, Director of Banking, Identity and Market Strategy, this interactive roundtable discussion will delve into the latest trends and challenges in compliance to discover how real-time, compliant onboarding can lead to increased revenue and customer satisfaction.

Including FullCircl’s own research on customer expectations and how 500+ regulated businesses are currently approaching the challenge this is a not-to-be-missed session.

You’ll learn:

• KYC & AML regulation: What information needs to be identified at account opening to remain compliant?
• Customer expectations: How long do customers expect onboarding to take? What processes do they prefer? What drop-off rate should you be aiming for?
• Revenue generation: How can customer onboarding be used as a competitive advantage? Why is real-time account opening the key to success?

Stay current with the latest FinCrime trends

The two-day event is an exclusive gathering of industry professionals in FinCrime, it promises engaging content and interactive workshops that will help you:

• Stay on top of the latest compliance, KYC, scams, and cyber threats
• Engage in the FinCrime community
• Benchmark you organisation against innovative FinCrime leaders
• Uncover the latest innovations from leading technology vendors
• Gather actionable insights for tackling your biggest FinCrime challenges

Join FullCircl and you might even get a complimentary stay at the beautiful DeVere Wokefield Estate

Come and visit FullCircl to find out how we help financial institutions start smarter to grow faster, with compliance solved. Our suite of KYC, financial crime prevention, AML, and IDV software is trusted by 700+ clients to remain compliant and offer customers a seamless onboarding experience.

We have complimentary delegate tickets including an overnight stay at the exclusive De Vere Wokefield Estate, gala dinner, and access to all content streams for free.

Get in touch today.