6 reasons why you should automate your business verification now
The digital era has brought many advanced ways to improve traditional business verification processes that help surviving crises like we are experiencing currently with COVID-19. Despite this, many financial institutions are still approaching their due diligence programs with traditional methods — filling out forms, contacting various databases and processing the raw data they’ve collected. With the latest automated business verification solutions, AML specialists should be able to avoid menial paperwork and concentrate on decision-making instead.
The money laundering discovery rate is around 1–2% — which means that compliance teams need all the help they can get.
We have enlisted six reasons to automate your business verification today:
- Getting the latest data from foreign countries is difficult
When dealing with distant locations, such as third-world or Asian countries, it is often very difficult to gain access to the information necessary for making calculated business decisions. Language barriers and obstacles — like having to fill out complicated forms — slows down the process. Moreover, the acquired data will be in the local language.
2. Manual business verification is time-consuming
Banks, financial institutions, cryptocurrency and online payments services have to comply with anti-money laundering (AML) regulations, which require them to file large amounts of data about their business customers — such as the Ultimate Beneficial Owners (UBO’s), Politically Exposed Persons (PEP’s), associated people and legal entities (which also have to be cross-checked with AML-watchlists). This has led to most financial institutions taking 32 days on average to on-board a single business customer while contacting the representative around 4–8 times just to collect and verify information. This means that a mid-sized bank or financial institution has to hire around a 100 people just for compliance — which is very costly — while taking 32 days for on-boarding means that the client will enter the business relationship already exhausted.
3. Information is scattered across different data providers
International databases require manual checks for each associated entity and provide only parts of the data required for compliance. Collecting data from different sources makes the process longer, risking the quality of the result and increasing the risk of missing vital information. Since these traditional solutions are based on old software, integrating them can also take several weeks for an experienced developer. Modern solutions like Entify can be integrated via API within a few days with a much more stable outcome.
4. Processing raw data is laborious
Manual data collection from national registries or international data providers usually results in hundreds of pages of raw data, negative media articles etc. This means that this data must be processed, categorized and eventually turned into a coherent and structured report. Doing this manually is time-consuming and very susceptible to human error. That is why a good automated solution will give an immediate and reliable result which is easy-to-read, comprehensive and outlines all the potential risk points. This makes decision process faster, especially during crisis when companies are running against time.
5. It keeps manual labor to a minimum
After integrating a solution like Entify to your platform, processes happen without the client ever having to leave your platform. They verify their identity as the business representative via a liveness check with their selfie- or webcam. After they enter their company name, registration code and country — you will receive a Final Report outlining results in a straightforward way. This happens in 15 minutes and all you need to do afterwards is read through the report and make the final business decision.
6. During difficult times like seen with COVID-19, automation saves more than time
When people cannot return home from business trips, are ill or less productive due to different situations, automation helps business deal less damage. Every company’s biggest value lies in the people: employees, customers. Changes in their lives affect the company in every way. Valuing them and offering them the possibility to rely on tools, will help the company in the long run.
