Seamless Customer Onboarding using Digital KYC

Digital KYC | EKYC | Customer Onboarding

Seamless Customer Onboarding using Digital KYC

With certain procedures changing as the world battles the pandemic, one very successful change is the introduction of Digital KYC. Not only does it keep up with the safety procedure, but also makes life a lot easier. As per the new amendments, industry body, NASSCOM said, “The move comes as a major relief for the fintech industry as no cost-effective, scalable and customer friendly alternative digital KYC method was available to them, until now.”  For the banking and financial sector, not just there was an increase in the number of customer onboarding using Digital KYC but also received a lot of positive reviews from the masses as it makes their life much easier.

Of the roughly 175 countries with some form of national ID system in place, 161 are digitized and 83 collect biometric data. This presses even more pressure on the banking and financial sector to move on from the traditional method to a more automated and technologically aided method. The World Bank defines digital ID as “a collection of electronically captured and stored identity attributes that uniquely describe a person within a given context and is used for electronic transactions. It provides remote assurance that the person is who they purport to be.”

 

What is Digital KYC/E-KYC?

KYC (Know Your Customer)  started out as a part of the USA Patriot Act. This act was made for the sole purpose of catching offenders and making laws against them more secured and to increase the safety of the nation and its citizens. It was least controversial and least opposed. It was done with the goal of making sure that banks could verify their customers and that there was no fraud whatsoever in their identity. This was one of the major steps taken against money laundering and thus was accepted by financial and banking sectors quite easily.

 

Digital KYC procedure

Digital KYC (Know Your Customer) is an advancement from the old method of KYC where people had to visit certain verified institutions to get their KYC done so as to take part in certain online money transactions and to verify the credibility of the customer. KYC is the process of using two-way video applications to get their photographs. It does so by taking a screenshot during the video call or the live call. It also uses live geotagging to confirm the location of the customer. This is a completely online procedure and needs only a valid phone number and any government-issued identity card. The KYC verification process is also foolproof and end to end encrypted.

 

Digital KYC solutions and E-KYC in banks

Traditionally finance and banking sectors have been collecting hard copies of birth certificate, address proof etc. This is not just time taking but also takes a lot of effort and manpower. There are also a lot of chances of human errors and misplacing of documents. There is a lot of money and time and space required to maintain these documents as well. Some major financial institutions spend up to $500 million annually on KYC and customer due diligence, according to Thomson Reuters. The Thomson Reuters survey also found that 12% of companies said they had changed banks as a result of KYC issues. If the number of customers at a bank doubled, KYC requirements could cause them to wait six to eight weeks to start using their accounts. Thus a digital KYC eliminates all these issues and makes work easier for both the management and the people. These make the banking sector enter a huge competition and digitization remains the only way for them to survive.71% of trade providers have stated inadequate KYC practices as key factors in driving trade finance rejection rates. The world is learning from India as its Aadhar program successfully digitized ID for more than 90% of the population of India. Majority of banks in India have been able to speed up the process of customer onboarding using Digital KYC.

 

How did it affect customer onboarding?

Needless to say, this comes as a boost to all the fintech and banking sectors around the country. It is also a huge economic boost as barely any hardware is required and it is also a time-saving process as multiple registrations can happen concurrently. Several banks have already started using E- KYC for onboarding savings account customers and promoting the same for credit card registration. The rate of onboarding new customers increased rapidly because they felt a lot less friction in the data collection process. 

 

Statistics of the client onboarding process

In a paper published by Groupe Spéciale Mobile Association (GSMA), it is mentioned “we examined two approaches to conducting customer identification, verification, and due diligence (collectively referred to as “know your customer” or KYC) that make it easier for financial service providers to take on new customers: tiered KYC and electronic KYC (e-KYC). Between the two, e-KYC is the more promising long-term approach, but also the more challenging to implement.” This is a fully paperless process and thus promotes environment-friendly schemes too.

Seeing that digital KYC has a vast scope in the future, multiple start-ups are coming up with the idea to make it more effective. One such company is PiChain. It is a real-time onboarding company which uses Machine learning and AI algorithms to increase the efficiency of their customer onboarding process. PiChain has also developed a full-fledged On-boarding suite that uses the AI, Machine Learning and Blockchain to its advantage to ensure real-time onboarding in less than 90 seconds, a 90% quicker turnaround time and whooping 75% reduction in Operation expenditure. The On-Boarding Suite includes VideoKYC, eKYC, AML Screening and E-Signature approved by regulatory authorities. The International Telecommunications Union (ITU) identifies 22 governments that allow third parties to access their digital ID systems for the purpose of conducting KYC. It also determines the documents that are needed by the client to complete the procedure. This process is integrated with Machine Learning and AI algorithms to make it more secure and easier to detect frauds.

Considering all of these together, as we march towards the new normal caused by the COVID-29 pandemic, all organizations are changing and exploring new ways to make their services more user friendly. In the midst of all these digital KYC comes out as a service that is here to stay and grow. 

eSign or Electronic Signature are Redefining the Era of Digital Signature

eSign or Electronic Signature | Digital Signature

eSign or Electronic Signature are Redefining the Era of Digital Signature

With the ongoing pandemic of Covid-19, concepts like social distancing, digital transformation have surfaced. Majority of the businesses are shifting from the conventional method to digitalization. No physical contact, paperless transactions are now becoming a reality that the people need to abide by. Amidst such occurrences, a new notion of digital signature or eSign has been prominently recognised. Some businesses have already implemented eSign or Electronic Signature. 

 

A wet signature is a legal consent given by a person thus, assumes a lot of significance. The KYC based eSign is legally equivalent to this wet signature. Like the wet signature, it also ensures non-repudiation and legal binding.

 

What is eSign?

 

eSign is an abbreviation for Electronic Signature. As technology evolves, new methods of signature are invented. The Legal definition for Esign:

 

“The term ‘electronic signature’ means an electronic sound, symbol, or process, attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record.” — Electronic Signatures in Global and National Commerce Act (ESIGN).

 

In layman’s words, eSign is digitally signing the document. A paperless method by which a person or business entity can enter into an electronic contract. The concept of Electronic Signature was introduced through The Information Technology Act, 2000 but since then no major heed was paid to it until now. In India, eSign has evolved in recent years which will soon be changing the face of online transactions. Being an alternative for wet signatures, we require certain documents in place to avail this service. For a document to be signed digitally, we need to possess a Digital Signature Certificate from the Central Authorities of the country.

 

One of the notable features of eSign is that it can be done anywhere, anytime without much hassle. It makes use of digital signature technology which is used to sign a said document. Like the wet signatures, eSign is legally binding and highly regulated. It is considered to be a valid identity of the proxies and becomes legally binding. 

 

What is a Digital Signature?

 

In order to authenticate and verify the validity of the digital document or message, a mathematical sequence is used which is called Digital Signature. It is an algorithm that the receiver of the digital document can use to check and verify if the document or message received by him/her is not modified and is in its original format. It makes use of Public Key Infrastructure (PKI) to provide both the entities with the highest level of security. PKI is a standard, universally accepted format that allows inter-country transactions digitally with minimized risk of false identity.

 

Even though Digital signature and electronic signature are used interchangeably but one must understand that they are two different fundamental concepts. An eSign or electronic signature is the image or representation of the original wet signature which can be in different formats or a combination of them. It can be the original signature, digital certificate or the biometric signature. While a digital signature is a mechanism behind eSign. It is used as a technology to authenticate the document validity. Also known as a digital certificate, it is the cryptography behind an electronic signature.

 

Both digital and electronic signature have one fact in common; they allow you to sign the documents and authenticate the signer. Both of the signatures differ on a various basis such as the technical implementation, legal acceptance, geographical use and the purpose. The digital technology used for eSign significantly varies between countries. The countries such as the United States, Canada, United Kingdom, Australia follow open, technology-neutral laws whereas countries in South America, Europe and Asia follow tiered eSign models where the digital signature technology is based on locally defined standards.

 

In India, every individual who has an Aadhaar number can do a wet signature equivalent to digital signature using Aadhaar eSign. 

 

What is Aadhaar eSign?

 

We know that Aadhaar has weighing importance for KYC verification which earlier was an irksome task but the eSign technology makes it more simple and nimble. It facilitates digitally signing of the document by an Aadhaar holder using the Aadhaar E-KYC services. This is an integrated service that issues a Digital Signature Certificate to perform the task e-signing the document. Since it uses the Aadhaar card to authenticate the signer, a person must have an Aadhaar card for availing eSign services. If you are a registered Aadhaar user, you can automatically use the eSign services with no prior paperwork. 

 

For instance, if two parties or entities wanting to enter an agreement, have a 12 digital Aadhaar number and registered Aadhaar mobile number, then it is possible for both of them to conveniently sign the document without being physically present. It is an initiative by the Indian Government to allow a person having an Aadhaar to instantaneously sign & verify a document anywhere, anytime; thus saving time and costs. Under the provisions of The Information Technology Act, eSign or Electronic Signature assumes equal value as a wet sign and is a recognized form of a signature that holds legal validity. 

 

The working of eSign

 

Though the process may seem simple to the end consumer, the mechanism behind such a highly regulated service is more sophisticated. The framework of the system is derived from Application Service Provider which creates an application interface when a user accesses the eSign services. ESP (eSign Service Provider), a government-approved entity is accessed by the user using the API. Once the connection between the user and the ESP is established, the user provides authentication of their identity using the data saved on their Aadhaar profile using fingerprints or an OTP verification code sent on the registered Aadhaar mobile number/registered Email ID.

 

Soon as the information provided by the user matched the KYC database saved by the Indian government; a certified, government-regulated authority issues a temporary Digital Signature Certificate. A PKI is generated and an audit trail with the authentication response is created. The ASP will then receive the signature from the ESP that is attached to the document and as the signature is fixed, the key gets destroyed automatically after one-time use.

 

Benefits of E Signature

 

Interwoven into the globalised world, eSign is welcomed by many countries due to its noteworthy benefits:

 

  • E Sign has brought relatively big effects by opening up more global trade opportunities.

  • The tedious task of being physically present for signing the document is no more required.

  • Lot of productive time is saved as the signing of documents can be done instantly.

  • Eliminating the cost of enormous paperwork, printing, scanning and travelling, eSign has been favoured by many people.

  • It is a legally recognised and valid document managed by licensed Certifying Authorities ensuring that there is no identity theft.

 

By now, most of the countries have adopted the digital signature technology and are improving their compliance regulations. The country and industry-specific regulations are evolving continuously, a prominent example is the regulation recently adopted by the European Union known as Electronic Identification and Trust Services (eIDAS) regulation.

 

In India, there are some exceptions where eSign is not applicable. Here are the classes of documents that cannot be eSigned:

 

  • A negotiable instrument as defined in section 13 of the Negotiable Instruments Act, 1881

  • A power-of-attorney as defined in section 1A of the Powers-of-Attorney Act, 1882

  • A trust as defined in section 3 of the Indian Trusts Act, 1882

  • A will as defined in clause (h) of section 2 of the Indian Succession Act, 1925 including any other testamentary disposition by whatever name called

  • Any contract for the sale or conveyance of immovable property or any interest in such property

  • Any such class of documents or transactions as may be notified by the Central Government in the Official Gazette

Video KYC: A Monumental Step towards Digitalization

Video KYC | Know Your Customer

Video KYC or V-CIP: A Monumental Step towards Digitalization

A commonly heard term in the banking industry is KYC (Know Your Customer). KYC is the process or step in which there is an assessment of the customers’ profile. It evaluates the risk of the customers of a bank or financial institutions to ensure that they comply with the Anti-Money Laundering (AML) laws. 

 

With the emerging technologies like Artificial Intelligence (AI), UIDAI Biometrics, machine learning, face matching and recognition, the concept of Digital KYC took birth. E-KYC or Digital KYC was able to surpass the issues that the manual KYC process faced earlier but was still lacking in achieving complete digitalization. The prominent technology which is helping us to go fully digital is Video KYC.  

 

Background 

The KYC process is imperative for Regulated Entities (RE), yet past years haven’t proved to be beneficial to bring out novel developments in this field. But as complications began to arise, the process of identifying and authenticating customers is exposed to the risk of frauds and the great threat of money laundering. This has impelled some developments to tackle the ever-rising problems of REs.

 

With the recent amendment in The Prevention of Money Laundering Act (PMLA), the regulators allowed several modes of capturing customer details electronically. This led to various developments of technology across industries including the KYC process in banks. The regulators recognized the downside of the physical presence of the customer and sheer data handling in the KYC process even if it was for E-KYC. Though Digital KYC was used earlier, the KYC process was still cumbersome as the customers were required to provide the documents in the physical form. Earlier this year, intending to reduce the cost of customer acquisition, the errors in KYC documentation and adherence to the AML regulations, Reserve Bank of India (RBI) released an amendment on 9th January 2020, adding Video-based Customer Identification Process (VCIP) as another option for KYC verification in the financial community. As an impact of the Covid-19, in-person interaction has not remained a feasible option for verifying documents in the KYC process. Hence, Video KYC has become a viable option in the KYC process.

What is Video-KYC?

 

 Video KYC or VCIP is the process of digitally authenticating the customers and overcoming the difficulty of physically examining the documents. KYC verification involves checking all the documents submitted by the customers and the absence of the technology made it a tedious and daunting task for humans. The Video KYC has surmounted this hurdle, bringing efficiencies in the KYC process and reducing the expensive customer onboarding task. This proved to be mutually beneficial for the banks as well as customers. 

VCIP has gained a lot of attention majorly from the banking and financial institutions. They experienced an increase in productivity and speeding up the process due to minimal intervention of humans.

Video KYC leverages the video call technology in onboarding the customers via video KYC authentication which has proved to be the most significant development in the field of KYC. It is a simple, seamless and scalable process by which the institutions can acquire customer details and documents before onboarding them. This is a reliable system which uses AI-enabled technology that helps in the prevention of fraud and checking errors.  

Steps in Video-KYC Process

Video-KYC is the game-changer for the industry, cutting down the extensive time-consuming process of document examination from a few days to a couple of minutes. This involved the following, hassle-free steps to be performed by the customers – 

  • Registering and filling up the details on the online form on the website or mobile app of the Regulated entities (RE).

  • Consent to be obtained from the customers to fetch Aadhaar details, PAN number and other official documents to conduct E-verification. Meanwhile, allowing the bank to access the real-time location of the customer using geotagging software.

  • Scheduling a date and time for the customer onboarding process where banks send a link to the customers to the webpage for video call.

  • The bank official initiates the conversation by asking to display the documents on the video call. The software will grab the details from the documents and verify it with the uploaded documents. 

  • Using the facial recognition technology, the bank will verify the customer on the video call with the photograph on the documents.

  • The bank official will ask randomized questions as per the banks’ internal policy to ensure it a live interaction.

  • After assessing the answers, the bank official will decide whether the customer application should be approved or disapproved. Also, the video call interaction is stored by the official to ensure non-repudiation.

 

The technology used in Video-KYC is a robust, secured and encrypted to prevent data leak which, otherwise, might be a data privacy concern. Each and every step in Video-KYC is done in real-time using AI-enabled techniques of automated data extraction, machine learning and face matching. 

 The Benefits of Video KYC

  • This type of KYC verification process drastically reduces customer onboarding costs.

  • Streamlines the complex process through automation using Artificial Intelligence.

  • Helps to detect frauds and malicious activity and safeguards the investors.

  • Keep a check on criminal activities majorly money laundering

  • Cost-effective technology involving minimal paperwork

 

Video-KYC is monumental but just a mere step in the financial sector, furthermore, developing an impeccable experience in e-commerce, telecom and networking industry. 

Benefits and Features of a Compliance Management Software

CMS

What is a Compliance Management Software?

An organization’s adherence to professional and government regulations and standards per their industry, the compliance management software helps with the automation, centralization, consolidation and streamlining processes, data and communication for above. This management software provides compliance solution strategies which helps with risk management, deployment of optimized workflow and empowerment of staff with greater information and insights regarding the compliances to avert from hefty fines or the worst, shutdown.

Irrespective of the type of the industry, the business has to adhere to regulatory government policies. Non-compliance is always detrimental as the business may suffer terribly.

To ensure that non-compliance doesn’t impact your business, one can use a compliance management software. This is a technological solution that helps you and your company become more legally competent.

Benefits of compliance management software

Benefits of Compliance Management Software:

Firstly, let’s get into the necessity of the compliances and what are their requirements. Compliance is fundamentally a legal, social, ecological, and financial compliance benchmark that aims to preserve a business’/industry’s ethics, liability and overall performance in a particular sector. It can also be defined concerning regulatory perquisites to protect employees from harassment.

The compliance officers lose their time in the search of data ensuring company’s adherence compliance. Therefore management software does the automation of the repetitive and tedious processes of gathering data, communication and knowledge sharing, decision making and staying up-to-date with the changes in compliance requirements and integrating it to the whole system. 

Therefore, why should businesses need to invest in and use compliance software?

 

  • Reduction in legal complications: 

As we know all businesses need to abide by social, legal, corporate, environmental, government and financial compliance and framework to operate upon which would steer the business clear of fines, penalties and lawsuits. The management software ensures full implementation of the operations in the organization. Thereby preventing complications to cascade from loopholes into crisis. The administration and execution of policies to the fullest extent ensures the policies to gain power. This is one of the biggest advantages of software.

 

  • Efficient operations and processes:

In the spirit of prosperity and success, organizations need to aspire for transformation and advancement. Feedback solicitation and timely evaluation in the form of internal and external audits help to point out irregularities to enhance the quality of discharge of workflow. Therefore software ensures proper documentation of audits, checklists, evaluations and improvements and their communication teams, globally and globally.

 

  • Expedite compliant and well-informed decision-making:

In the case of irregularities in the system with the help of compliance software, the flag can be put up. Pass it on to the delegates so they can resolve the issues immediately. In a nutshell, it helps in safeguarding the organization’s financial and legal uprightness.

 

  • Productive cooperation and correspondence:

In any organization or business, employees and officers are the frontlines of facing the inconsistencies and risks in the system and fulfilling the compliances. Therefore, centralization and simplification of the communication of these fallacies so that they are detected, assigned and executed efficiently. Hence, compliance management software ensures frictionless and tangible modus operandi for recording and transmit the complications and occurrences among groups of people.

Compliance Management Software

What are Popular Features of Compliance Management Software?

 

We have discussed the benefits of investing in compliance management software. Let’s look into the elements of features of it.

  • Easy-to-use user interface:

The software must provide a good and simplified user experience. Compliance management software must intuitively be easy to use. The software’s frontend like design finishing, layout, features and the relevance of it explains the functioning.

  • Top-notch analytics:

With the advent of industries big data, compliance management software provides methods to visualize and display trends. Before being referred to upper management, the answers to complications are available.

  • Control over documentation:

The software expedites document control which includes dedicated management of records, forms and documents that business transacts. Document controlling is a major want by ISO 9001.

  • Managing fraud:

An account of dubious activities, the software ensures reporting and resolution of anomalies regarding financial compliance and potential frauds like payments and bribes.

  • Managing processes:

In the spirit to strive for excellence, owning, managing, remapping and dissecting processes while making the management process streamlined by becoming seamless, integrated and collaborative. Visualization of modus operandi through flowchart tools and mapping is must so that everyone is on the same frequency while operations.

  • Managing incidents:

Management software should have a well-designed communication algorithm for the simplification and streamlining the process of raising the red flag of incidents and events.

  • Capacity Development:

Onboard learning is a must for compliance officers so that they are up-to-date with the compliance set by regulatory bodies and commissions.

  • Online system for compliance requirement:

The software should have a centralized system for gathering reports on compliance, new regulations and requirement changes and firm integration with the business process.

  • Reporting compliance:

Management software should be able to manufacture a line up of data extracts, compliance reports and ensure that these reports are representable as well as customizable for the management to take action. 

  • Workflow and Task management:

Time-saving, efficient resource and compliance task management for end-to-end workflow across a different point of interactions are must from a software.

  • Risk Management:

Productive management software provides methods managing, monitoring and analysis of risks throughout the stakeholder hierarchy and other key business processes.

  • Data security:

The software must provide uncompromising data security across all levels of value chain using encryption, advanced security systems, transfer of data and easy integration.

  • Offline competence:

Management software must provide options for collections and processing data being offline. Such feature empowers businesses to operate smoothly without paying much attention to their initiatives in businesses.

  • Integration competence:

The compliance management system must be capable of integrating with the third party and supporting systems for example HR, CRM, trading systems, research systems and many more. Automation provides efficiency saving time, money and resources which management software must be capable of providing more time and energy for policy formation and compliance strategy and management comprehensively.

© 2020 PiChain Innovations Pvt. Ltd. All rights reserved.

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BMI Securities Limited breaches anti-money laundering regulatory requirements, gets severely fined by SFC

BMI Securities Limited breaches anti-money laundering regulatory requirements, gets severely fined by SFC.

BMI Securities Limited (BMISL), a Hong Kong based financial securities investment firm, got a penalty of $3.7 million by Securities and Futures Commission (SFC). They failed to comply with the anti-money laundering (AML) and counter-terrorist financing (CFT) regulatory requirements. (#1)

BMISL’s responsible officer, SFC did suspend Ms Maggie Tang Wing Chi for five and a half months from 11th February 2020 to 25th July 2020. (#2)

The shares of two listed companies placed were subscribed through BMISL in 2016. Using the bought and sold notes in off-exchange transactions the clients transferred most of their placing shares to third parties for the substantial amounts ranging from $4.4 million to $855 million. (#3)

These transactions showed suspicious features like:

  • The shares placed were disproportionate to the subscription amount with the client’s financial profile.
  • No transactions were done in BMISL accounts. Apart from acquiring and disposing of the shares placed.

Findings by SFC are as follow:

  • Inadequate implementation of controls alleviates the risk of money laundering and terrorist financing associated with bought and sold notes via suspicious transactions.
  • No distinguishing, proper inquiry and insufficient scrutiny on suspicious dealings. No consideration for reporting them to Joint Financial Intelligence Unite where appropriate
  • Neglecting proper customer due diligence and keep customer-related information updated and relevant.
  • Absence of adequate and effective framework for identifying politically exposed persons and singling out terrorists and sanction designations.

From SFC’s point of view, BMISL’s conduct was breaching the Guideline on Anti-Money Laundering and Counter-Terrorist Financing (AML guideline) and Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO). (#4)

SFC’s investigation further resulted in the findings and the BMISL’s breaches because of Ms Tang’s incapability to discharge her duties as a responsible officer and as a member of BMISL’s senior management. She failed to identify, conduct appropriate inquiries and implement effective AML/CFT systems to subside the risks of money laundering and terrorist financing.

Factors in consideration so that SFC could decide sanctions against BMISL:

  • The message that AML/CFT is intolerable, is propagated in the market.
  • Tang and BMISL’s cooperation for resolving the concerns from SFC.
  • The remedial actions by BMISL to better its AML/CFT systems and controls.
  • An independent reviewer will prepare a report to log the successful rectification of identified concerns. BMISL will submit this report to SFC within twelve months.
  • BMISL’s financial situation.
  • Clean disciplinary records of BMISL and Tang with the SFC.

 Notes (#)

  1. For carrying out Type 1(transactions in securities) regulated activities, Securities and Futures Ordinance (SFO) did provide the license to BMISL.
  2. SFO provided the license to Tang for carrying out Type 1(transactions in securities) on behalf of BMISL and Type 9(asset management) regulated activities on behalf of BMI Funds Management Limited since 17th February 2016.
  3. SFC reported suspicious activities to the Joint Financial Intelligence Unit. The focus of the investigation was on the adequacy and effectiveness of BMISL’s AML/CFT systems and controls.
  4. The licensed corporations must implement appropriate internal AML/CFT policies, procedures and controls to ensure compliance with relevant regulatory and legal requirements. Every reasonable measure is undertaken to ensure proper safeguards to palliate the risks of money laundering and terrorist financing.
(Image Source:- Riskscreen.com)

Transaction Monitoring in Anti-Money-Laundering

Transaction Monitoring in Anti-Money-Laundering

Transaction Monitoring in Anti-Money-Laundering

As the volume of transactions continues to increase and money laundering techniques become ever more sophisticated. The financial institutions face fundamental challenges on anti-money laundering (AML) in  transaction monitoring, making this an increasingly expensive task.

What is Transaction Monitoring?

In simple words, Transaction monitoring is an Anti-Money Laundering and fraud prevention security process that reviews and analyzes suspicious financial transfers or commercial transactions in digital and fiat currencies, ultimately exposing the origins.

Why Transaction Monitoring?

Companies and Financial Institution are using transaction monitoring to prevent terrorism financing, financial fraud, evasion of taxes, and other types of money laundering.
A vital part of any bank or Financial institution is to Monitor the client’s profiles and their transactions.

The AML monitoring Transactions are

1. Deposits
2. Transfers between accounts
3. Withdrawals
4. Exchanges of currency
5. Extensions of credit
6. Any monetary instrument or investment security;
7. Any other payment or transfer, etc.

Money-Laundering Alerts in Monitoring Transactions

1. Monitoring of cash deposits,
2. Withdrawals, wire transfers that exceed statistical thresholds
3. Complete assessment of money transaction history of the Customer
4. Blacklist screenings
5. Sanctions screening
6. High-risk transaction regulation and exposure.

The 5 Real-time Indicators of Transaction Monitoring in AML

1.Suspicious Activity Report

This is the final result of an investigation, and broadly indicates the meeting of overall Transaction monitoring system objective related to the suspicious activity. There is a need to make sure the Case categorization along with other details is represented to provide to the investigation.

2.Quantum of False Positives

a well-performing transaction monitoring system makes sure that the number of false positives is greatly reduced which accounts for about 87%.

3.Changes in Regulations

Understanding changes will drive investigative activities. current transaction monitoring systems are oblivious to the current regulatory changes which need to missing of suspicious transactions. a robust transaction monitoring will have the changes in the regulations incorporated so that suspicious transactions are tracked in real-time

4.Different Monitoring scenarios

Lack of proper customer and account segmentation, new products will need to more scenarios to be created. Transaction monitoring systems have to be well aware of the above to make a difference in the operations.

5.Operational costs

Cost related to the Operations teams used to complete investigations and systems tasks needs to be taken into account along with the system infrastructure to support the transaction monitoring system.

At PiChain we understand how important KYC and KYB is for business.  To support all our customers and businesses during these challenging times of COVID-19 we have made our fully digital contactless AI/Blockchain driven COVID proof eKYC and eKYB solutions completely free this year. We do realtime eKYC and eKYB along with AML checks for more than 40 countries.

Please email us at kyb@pichainlabs.com for queries.

© 2020 PiChain Innovations Pvt. Ltd. All rights reserved.