Accelerated onboarding for global wealth management firm, with 25% cost saving

Challenge

One of the main problems financial institutions face is the onboarding of high-risk wealth management customers, as it relies on the ability of a streamlined, automated solution to conduct enhanced due diligence for a large number of entities.

A Tier 1 global bank headquartered in New York encountered this very problem, and wished to productize their specific requirements, using only one team for implementation.

Similarly, the bank had to meet consistent regulatory requirements for high-risk Enhanced Due Diligence (EDD); operational inefficiencies in onboarding can cause compliance teams issues. The client required a standardised solution for their KYC and onboarding which covered policies across all regions and jurisdictions.

Their global remit also extended to their own team of 250 highly skilled EDD team of 250 analysts, based in the UK, the USA and Singapore. Customer onboarding is notoriously long and laborious, costing banks vast sums of money. This particular client had to meet cost reduction targets of 10% year on year for three consecutive years.

Solution

The bank’s EDD requirements carried huge depth, and required the ability to search behold standard adverse media providers for more detailed risk analysis. For instance, the searching of local court registers. Using the data provided by the Arachnys platform, the bank could justify policy changes around the adverse keyword search, and where some were found to trigger false positives, Arachnys assisted in ‘reducing the noise’, lowering 45 adverse terms to 25 and therefore reducing the headcount on laborious false positive-related tasks.

Arachnys also helped conduct a review of every policy for each jurisdiction, and digitalised all of these processes to create frictionless onboarding, and ensure that compliance was met with minimal inefficiencies and reduced cost. After an implementation of three months, the platform was integrated with their internal system within six months, and Arachnys continues to provide 24-hour production support.

Beyond onboarding, the bank chose to leverage Arachnys to further enrich entity profiles using the platform; they were able to run EDD beyond initial KYC to monitor for changes and create reports for existing clients if they crossed a set high-risk threshold. The success of the project led to Arachnys being featured on the bank’s intranet homepage as “the best vendor relationship we have ever had”.

Results

  • Cost saving – far exceeded the 10% cost saving target, with a recorded 25% reduction within 6 months
  • Increased efficiency – the client recorded a 73% reduction in QA failures from reduced manual effort
  • Accelerated onboarding – a frictionless, digitalized process stores KYC results for use in ongoing research
  • Go-live – 12 weeks from contract signature to fully implemented live platform