Four takeaways from Paris Fintech Forum on KYB trends
This year’s Paris Fintech Forum took place on 28–29th January. As one of the most important trend-setting finance events in Europe, it did not fail to set the direction and trends for 2020. Over 300 CEOs from more than 75 countries discussed topics most relevant to the upcoming months. The topics were serious, but the general vibe hopeful. Entify’s CEO Neeme Org shared four main takeaways from the forum.
Sanctions and regulations are widening the scope of companies that need to comply
„Due to the changes in 5AML Directive, cryptocurrencies and wallets are a trending topic. This is creating a fuzz of who will be added to the list next. Many expressive examples of cases from customers that had compliance issues were brought from different sectors. Painful lessons from both your own as well as partners’ actions. The importance of technological development was brought out as it will be crucial to survival during the next few years,” Neeme Org, a speaker in the panel explained.
The directive has been quoted a lot due to the references it contains suggestions toward automatisation. It was emphasised many times that it is important to know when the machine is making the decision. Currently, the main takeaway is that the person behind the computer makes the decision, the data is provided by the machine.
Technology is expanding to unexpected areas
“It was clearly brought out that the future favours those, who can maximise the benefits of machine learning and other technological opportunities in the earliest stages. To help and train the algorithms to see the right solutions, threatening aspects and patterns to inform the decision-makers about the parts that seem fraudulent. The areas, where identity verification is used, are expanding and it should not be used only to comply with regulations but also to protect the company from fraudulent behavior, resulting in reputation loss. Uber losing its London market was one of the examples that could be prevented in the future by implementing KYC and KYB processes.
During the last 15 years in business, I have not seen a time, where reputation loss is considered so devastating. Data needs to be collected, handled and restored in a secure manner at all costs. Reputation is everything for companies. We as business owners need to be more agile, more clever and well aware,“ Org added.
The quality and timeliness of data needs to be guaranteed
When some of the know your customer processes take weeks, they need to be substituted with faster solutions. “The quality of data is only guaranteed in a short time frame for it changes constantly. Accuracy, timeliness and thoroughness are the key factors. For example, it is not only important to know whether the company exists and is working. The associated people, ultimate beneficial owners and the background are also essential. There can be surprising outcomes in adverse media that are not noted anywhere else but will be damaging to your company’s reputation if being associated with the company. Or that the company or persons are added to sanctions’ lists. Then this screening needs to be done periodically, not just once,” Org explained.
Regulations can be seen as an advantage in competition
Another challenge for companies that have been just added under regulations, is to try and figure out how to benefit from it, how to use it as a competitive advantage. “When a sector is regulated, it gives the same obligations to everyone in that sector. Finding a smart way of turning obligations into possibilities will grant the biggest success. If you can make compliance easier, faster and more secure, you can not only guarantee your reputation and customer safety, you are also beating the competition in the run,” encouraged Org.
