Know Your Business (KYB) is a critical aspect of compliance in the regulated payments sector. Ensuring data accuracy is paramount, as it directly impacts the ability to meet regulatory requirements, mitigate risks, and maintain trust with stakeholders. The process involves verifying the identity and legitimacy of business entities before onboarding them as clients.
Given the complexity and volume of data involved, leveraging automated KYB tools that are data agnostic and capable of aggregating data from various sources, including registries and government sources is essential.
In this article, we take a look at how your firm can achieve data accuracy during KYB onboarding.
Challenges in achieving data accuracy
Achieving data accuracy in KYB processes is fraught with challenges:
- Data fragmentation: Information about businesses is often spread across multiple registries, databases, and sources, making it difficult to obtain a complete and accurate picture.
- Data quality: The quality of data from different sources can vary significantly. Some data may be outdated, incomplete, or inconsistent, complicating the verification process further, especially where international jurisdictions are involved.
- Manual processes: Traditional KYB processes rely heavily on manual checks and verifications, which are time-consuming and prone to human error.
- Dynamic nature of business information: Business information is constantly changing. Keeping up with these changes requires continuous monitoring and updating of data.
Using tech for data accuracy
Automated KYB tools offer solutions to these challenges by automating and enhancing the KYB process. These tools are designed to be data agnostic, meaning they can integrate and process data from multiple sources seamlessly.
Data aggregation
Tools like WorkStation from NorthRow can aggregate data from various registries, databases, and other sources, providing a comprehensive view of a business entity. This includes information from company registries, financial statements, sanction lists, and media reports. By consolidating data from multiple sources, these tools help ensure that all relevant information is considered during the verification process.
Real-time data updates
One of the significant advantages of KYB tools is their ability to provide real-time data updates. This is crucial for maintaining the accuracy of business information, as it allows payment service providers to quickly respond to any changes. For instance, if a business’s registration status changes or if it is flagged for suspicious activity, the RegTech tool can immediately update this information, ensuring that the KYB process reflects the most current data.
Data standardisation
KYB tools can standardise data from different sources, ensuring consistency and accuracy. Standardisation is particularly important when dealing with international clients, as it ensures that data from different jurisdictions is comparable and reliable.
Automated verification
Automating the verification process is another benefit of automed KYB software. These tools can cross-reference data against multiple sources and flag any inconsistencies or anomalies. Automated verification reduces the reliance on manual checks, minimising the risk of human error and speeding up the KYB process.
NorthRow provides a comprehensive solution that automates AML compliance and KYB processes. The tool aggregates data from various sources, including global sanctions lists, adverse media, and PEP (politically exposed persons) databases. It provides real-time updates and alerts, ensuring that payment service providers have access to accurate and up-to-date information.
