Digital identity solutions can offer fast and secure onboarding that is frictionless and convenient. How are these cost-effective digital solutions helping banks and financial institutions (FIs) of all sizes to enhance their customer experience while they also #FightFinancialCrime?
- The rapid digitalization of financial services is resulting in the development of solutions that are accessible to industry players of all sizes, which can help them to #FightFinancialCrime.
- Digital identity solutions can help financial institutions to identify, verify and screen customers more quickly and more accurately than ever before, while also delivering exceptional customer experiences.
- Refinitiv recently launched a new digital identity solution that offers accurate, reliable digital identity verification, document authentication, anti-impersonation tests, and screening via seamless API technology.
Our March 2019 survey of over 3,000 managers with compliance-related responsibilities found that financial crime affects the majority of organizations in one form or another, so there is no better time to start exploring how digital identity solutions can help you mitigate financial crime risk.
Conducted across 24 countries, the survey revealed that nearly three quarters (72 percent) of participating organizations were aware of financial crime in their global operations over the preceding 12 months.
Financial crime is pervasive and only a very small percentage of reported stolen funds ever recovered.
Emile van der Does de Willebois, the World Bank’s Lead Financial Sector Specialist and Global Lead for Financial Market Integrity, told Refinitiv in a recent Expert Talk about a gaping discrepancy between the number of suspicious activity reports (SARs) submitted by FIs and the amount of money actually recouped.
He calls the gap ‘formidable’, noting a 2017 special report from The Future of Financial Sharing program that said over two million SARs were submitted in the U.S. and nearly half a million SARs were forecast in the UK, yet less than one percent of criminal funds were frozen or confiscated.
Rise of digital identity solutions
Given the pervasive nature of financial crime and our apparent inability to recover any meaningful percentage of stolen funds, it is essential that FIs embrace new tools to fight back against corruption — and the digital revolution could hold the key.
The rapid digitalization of financial services is continuing unabated, driven by several factors, including:
- Technological advances and new market entrants.
- Regulations that have placed new emphasis on consumer privacy and protection.
- The insatiable technological appetite of customers, who now expect a frictionless, consumer-centric omnichannel experience from their service providers.
- A growing need to protect against sophisticated financial criminals.
This digital revolution has led to the development of many innovative tools to help overstretched compliance and operational teams maximize their resources.
These include digital identity solutions enabling financial institutions to identify, verify and screen customers more quickly and more accurately than ever before.
In contrast, FIs that continue to rely on a manual approach to customer identity and verification processes are potentially leaving themselves vulnerable to an increasingly sophisticated range of risks.
Manual processes are often slow, which can lead to high customer abandonment rates, while inaccuracies can result in gaps in due diligence and allow financial crime and fraud to go undetected.
Secure identity verification
Digital identity solutions offer fast and secure identity verification and screening that is seamless and accurate, with a host of other benefits:
- Digital identity verification and screening is quicker and easier than manual equivalents, so FIs can onboard and service more customers, more efficiently.
- Faster turnaround times and fewer touchpoints promote a better customer experience and reduced abandonment rates.
- Digital solutions remove the human error factor, resulting in better levels of compliance and more accurate screening for financial crime.
- The cost-effective nature of digital solutions means that even the smallest industry players can afford leading-edge technology to help them fight back against financial criminals.
Improving the client experience
Forward-thinking FIs are actively embracing digital transformation and working smarter to improve the client experience, accelerate the pace of business, and protect themselves against corruption, with many already using digital identity solutions.
Perhaps the best news is that these leading-edge solutions are not only available to large tier 1 organizations with the budgets, manpower and expertise to invest in new technology.
Flexible, cost-effective solutions are within reach of even the smallest of players, enabling them to reap the many benefits of the digital revolution and play their part in global efforts to eradicate financial crime.
Watch: Secure digital identity verification and screening delivered via a seamless API
Refinitiv recently launched a new digital identity solution built specifically for FIs, Qual-ID.
Qual-ID offers powerful, reliable digital identity verification and screening via seamless API technology and can be bundled with other Refinitiv solutions to meet dynamic requirements at any point in an FI’s digital transformation journey, across channels and geographies, while enabling compliance with KYC and AML regulations.