Anti-Money Laundering (AML) and Know Your Customer (KYC) Penetration activities are predicted to witness a 70 percent increase in 2023 as players in the financial industry increase their efforts to adapt to strict regulatory compliance obligations.
This is the prediction by the Co-founder / Chief Executive Officer, VerifyMe Nigeria, Esigie Aguele, a leading digital identity and Know Your Customer (KYC) technology company; and owner of QoreID, a B2B identity, and consumer data infrastructure company.
He said: “Increased regulatory scrutiny and the need to comply with Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) regulations have led to the demand for stronger KYC and compliance processes. As financial crimes evolve, regulators and institutions financiers must improve their risk-based approach to AML issues and find new tools to detect criminal risks and links.
“With regulatory advances, the industry will see a greater focus on the use of technology to automate and streamline compliance processes. Artificial intelligence and machine learning will be critical to increasing the efficiency and effectiveness of KYC and AML/CFT screening, helping organizations categorize and manage risk data which is relevant when increasing the transparency and traceability of financial transactions.
Aguele also believes that the consumer analytics segment will grow exponentially, especially with the rise of several Buy Now Pay Later (BNPL) models and the widespread availability of financial loan products.
According to him: “Consumer analytics facilitates the adoption of mainstream credit, open banking, and other microeconomics by providing the infrastructure and tools needed to help the financial industry better understand customers and provide value-added products and services. With access to reliable consumer data and can be trusted, financial services companies can comply with KYC regulations and streamline the customer verification and authentication process.
“An efficient and secure KYC system allows these companies to reduce the risk of fraud and identity theft, making it easier to offer credit and loans to a wider range of customers. The availability of diverse customer data also means that institutions can provide better and tailored services, which ultimately results in a seamless and enjoyable customer experience.
“In addition, consumer analytics, if used correctly, will produce very positive results for financial institutions because they will improve operational efficiency, create more efficient compliance procedures, and ensure the existence of effective risk management practices,” he concluded.