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    How to get banking back to the future

    Get banking back to the future:
    5 Out-dated beliefs holding you back

    13 September 2021

    There’s no place for out-dated thinking in the future of financial services

    MYTH: Banks refuse to adapt quickly to change
    REALITY: Banks are far more agile than we might think

    It’s been quite something to see how quickly our global client base and the banking community have adapted to the new norm in the Covid -19-era. Necessity is the mother of invention, and most banks have really driven the agenda for transformation in the digital space for KYC and AML much more flexibly and dynamically than we might have expected.

    The fact that banks and financial institutions have adapted to the new norm with such agility, tells me that the industry can go wherever it needs to be taken.

    MYTH: Data is King
    REALITY: Seize the data: the right data, at the right time with the right tools

    Data is King – but only if it’s leveraged effectively, efficiently and safely. The right data set at the right time is so important.

    “Data in our time is the equivalent to what steel was during the industrial revolution.”

    Seamus Keating, Chief Executive Officer, FD Technologies

    That is so true but data is also becoming increasingly complex.

    Looking forward, banks need the ability to dissect data and follow the customer through its entire lifecycle. Data aggregators are going to be so important when it comes to effective public searching and enriching data when a customer gets introduced to an institution. I’m a big advocate of using technological tools, such as Fenergo, to narrow the margins for error as the structures become more complex across the wider KYC agenda.

    MYTH: FinTechs and banks are too different to learn from each other
    FACTS: Dare to be different – Banks could learn a lot from FinTechs

    There are tools and technologies, and even just ways of thinking and looking at the world that Fintechs are embedding across their risk frameworks and banks are subsequently starting to implement in their own institutions.

    For example, Electronic ID&V has been part of how FinTechs run their companies for years: it drives competitive advantage but also underpins compliance. What’s really interesting is that more established retail banks are now moving towards that electronic ID&V because with Covid-19, they can no longer ask customers to go in-branch with their passports.

    This is just the beginning of an exciting period in which the technology and infrastructure that Fintechs have pioneered (and have ensured delivers for their industry) is now being adopted internally by the more established institutions.

    MYTH: Financial services will unearth The Golden Source of truth
    REALITY: The Golden Source will always be a fluid and flexible journey

    It’s very difficult for banks to get a ‘golden record’ or ‘golden book of records’ (a single source of data truth) for sharing and storing KYC information. In theory you might put an agile workflow in place, so you have the necessary technology to align the data sufficiently; you might then engage the counter-party to identify missing data and complete a risk profile and with all these resources combined your single data source might be compliant. At this point, you’ve attained your mythical golden source!

    But success will be short-lived. Tomorrow that source will be out of date, thanks to the just in time and perpetual ‘on’ nature of AML. There could be a change of ownership or a new person of significant control. As tempting as it sounds, a golden source of truth will never be possible purely because of the cyclical nature of KYC and AML.

    MYTH: CRM and CLM should not and cannot be combined
    REALITY: If you don’t combine CRM and CLM, your competition will

    There’s a long-held suspicion that the tools and technology of CRM and CLM cannot be combined, and still stay bespoke, efficient and compliant. This isn’t true. Streamlined processes and workflows are eminently possible – and critical to any company looking to develop, potentially expand their reach, remain compliant and stay on top of AML.

    With the right tools and thinking, it’s possible to use the slick functionality of CRM technology to enrich and reinforce the integrity of customer and client lifecycles. That’s what we’re here to enable at First Derivative: to bridge the gap between CRM and CLM to help drive compliance and efficiencies, and protect, nurture and develop each customer relationship.

    Functionality fused with adaptability.
    Customised solutions that breed consistency.
    Rigorous compliance brought about by bold and progressive thinking.
    It’s time to dispel those old and out-dated myths – and start to write a different story.

    For ongoing information on Client LifeCycle Management contact us.


    Kevin McGuinness Kevin McGuiness
    CLM Practice Lead, First Derivative Consulting


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