Skip to content

8 Best Practices for Fintech KYC | AML | Customer Tests

Fintech KYC | AML Cheet Sheet

Mobile-First Approach

So, nowadays to do it well, it’s wise to do it mobile friendly at least, and perhaps even Mobile First or Mobile Forced. Mobile Forced, like e.g. at Degiro. It is often preferred because of low quality of video cameras in the PCs or lack of some interfaces like NFC or geolocation. For these reasons you may opt for Mobile Forced or Mobile First Fintech KYC | AML process because you will have access to such devices or interfaces on the user’s smartphone. A lot of people, especially natural persons and retail customers do use it, do like it and it has more context or places where it can be used and done or at least started.

Make It Conversational

Gather data in small steps. Question, answer, question, answer, etc. It might be two fields or more on one screen and then instruction on how to fill them. It could be only one field on a screen, but that is a matter of choice.

Process Abandonment Handling

If the User loses his patience, encounters some interruptions or problems he will drop out of the process. If he stopped on any step then it is important to handle it and not force him to start the process over from the very beginning again, entering all the data. The probability that he will re-enter all the data is, let’s say, quite low and he needs to be really motivated to do it again from scratch. So it’s crucial to persist this data or save this data which he already entered and allow him somehow to re-enter this process, whether via a link in an email or by logging back to the app, so that he could continue the process in the app.

You could design this so that whenever a Customer drops out from your Fintech KYC | AML process there is a task being created in a Customer Relationship Management software or a Call Center software to facilitate that process. We can also use marketing automation tools to design our abandonment process, handle reminders and set a sequence of emails asking or reminding to finish the process or even perhaps incentivize those users who dropped out.

“Onboarding is that part of your business where you convert a prospect to a Customer so it is important not to lose money you invested in marketing or promotion, because those processes in a FinTech world are quite challenging and quite costly. So you don’t want to be losing money, therefore it is important to handle process abandonment and make the most of your sales.”

Progressive Data Gathering

That’s the concept a bit connected with previous points. Make it conversational and allow users to get back to the questionnaire. Of course, you need to gather this data in some steps. It might also be possible to adjust data gathering steps to the sales process. So you could at the very early stage gather a user’s email for your newsletter purposes or open a dummy account or an empty account which allows a given person only to log into the mobile or web app.

Then when your Customer decides to invest in some stocks or make some money transfer you will gather other needed data in the form of Customer Tests or MiFID tests. There are a lot of them, but you only need to ask your Customer to do the first one related to the choice of financial products she wants to use. And later she could go back to your application and start other tests for more advanced products like derivative products, leverage products or ETFs and so on.

Don’t Ask If You Can Extract

We mentioned the case of geolocation which allows you to determine Customerโ€™s address via GPS. That’s one thing you can extract in your Fintech KYC | AML. Other things are the data from the IDs or passports. Some countries have introduced eIDs, a type of legally binding electronic signature issued by government institutions or banks. For example, in Poland it is the so-called “Trusted Profile” (used primarily for contacts with public administration) and in Sweden it is BankID. From there, you can retrieve data such as the name and surname or the identification number of a given person. However, this only applies to natural persons. In the case of legal persons, data concerning them can be downloaded from some register of these entities. In Poland, it will be the National Court Register. If this data cannot be retrieved from an electronic document or through the available API, it may be necessary to perform OCR of the scanned documents or their photos.

Keep It Omni-Channel

Allow your Fintech KYC | AML process to be fulfilled or continued on different devices. Some parts of your Onboarding might even be not possible on one device, like e.g. liveliness check or document NFC scan, because they require a mobile device, On the other hand, tests and quasi-tests or entering some other data could be done on a laptop. You want your User to be able to go through the process in a Mobile App, Web App or your Call Center. Provide all of these different channels but gather the data in one database.

Inform The User

Another good practice is that you should inform the User, what she will need during the process and how the process would look like in general. So make sure that the User is not frustrated because he started some process and then learns he needs an ID or passport or utility bill to complete it. In the United Kingdom for example it is quite popular to verify utility bills.

Show Progress Bar or Estimated Time

Finally, the Consumer should know where he is in the process, at what step and how many steps are left until the Onboarding is complete. Alternatively or complementarily, you can also show him the estimated time needed to complete your Fintech KYC | AML process. All these elements allow you to increase the Userโ€™s conversion rate by helping them mentally visualize the length of the entire procedure. Of course, you should make sure that the length of each step into which it has been divided is properly balanced. If the first step is disproportionately long compared to the rest, your Consumer may get discouraged at the very first step. You don’t want that.