RegTech Solutions for Customer Lifecycle Management to Benefit Luxembourg

Today, Thursday 23 November, Luxembourg-based RegTech-strategy leader FinnoLux, in collaboration with the International RegTech Association, held the first of four ‘RegTech for Luxembourg’ briefing-sessions; the RegTech for Luxembourg series focuses on the practical way in which the Luxembourg financial centre can reduce costs, increase efficiency, and ease the burden of regulatory compliance through the use of technology.

Today’s session focused on RegTech solutions for Customer Lifecycle Management, including customer on-boarding, as well ongoing due diligence and off-boarding.

Keynote speaker, Rohini Gupta - who combines a hands-on appreciation of the industry gained through working for major players like RBS and Credit Suisse with the application of this knowledge in working in regulatory & supervisory roles in the UK regulators - set the stage explaining to the audience the need in today’s financial environment to not only comply with the spirit of legislation, but the need to be able to prove that true due diligence has been performed, both on new customers as well as on existing clients.

Other RegTech firms also gave their insight in today’s market challenges and explained how their products ease these challenges.

Kieron O’Brien, director for Know Your Customer Limited, gave a clear categorization of current global challenges the industry is facing: regulatory, operational, and commercial. He stressed the importance of the balance between risk management, operational efficiency, and customer experience, translated in a holistic view of KYC to cater for all clients, whether individual or corporate, domestic or international.

Know your Customer Limited solves one of the most expensive projects when onboarding. By using official data sources, Know Your Customer is able to ease the process by identifying beneficial owners in even complex hierarchies that cross international and continental boundaries.

Kompli-Global

Martin Pashley from Kompli-Global started his presentation with the highly interesting question ‘Why wouldn’t you check who your customer really is?’. In this era of information overload, they introduce Samantha, a chatbot who is able to screen international data sources, including court records and press releases, enabling an enhanced due diligence to be carried out both for new and existing clients. It also was able to highlight areas where clients have been involved in court proceedings, scandals, etc… The technology uses a proprietary scoring mechanism to assess the reliability of the data. He proved that Kompli-Global is a truly global organisation by showing their network of consultants around the globe who can provide a human interpretation where needed.

Taina Tech

FATCA & CRS are amongst the worse processes to handle when dealing with the USA, according to Maria Scott, CEO of Taina Technologies. Taina Tech have therefore developed a system powered by Artificial Intelligence that takes the pain out of getting these complex, yet highly important processes correct. The customer experience is enhanced and the risk is reduced as the real-time validation ensures invalid forms never reach the financial institutions.

Keesing Technologies

Rosalie from Keesing Technologies, probably the oldest RegTech firm in the world (1923), showed their capability in validating the authenticity of identity documents, whether it is the person with the actual document or online of scanned documents. Their technology removes doubt when onboarding clients using ID documents such as passports, driver’s licenses, and ID cards. Keesing can verify the authenticity of documents around the globe and is backed by a team of experts who provide second line assistance to manually provide an opinion. When onboarding clients, documentation is often provided in the form of copies of documents which are easily forged, so this solution adds an unrivalled level of confidence, as they employ the same technology as used in airports and government institutions for verifying the authenticity of documents.

A round-table chaired by FinnoLux Chief Innovation Officer, Leen Cuypers, drew on the experience of the different speakers, focused on the ways in which the local industry here in Luxembourg could benefit from applying technology. With its international and institutional focus, multiple jurisdictions and legislations are almost standardly involved in any onboarding action that is performed in Luxembourg. The increased awareness within the financial industry as a whole creates a never-seen openness towards new ways of doing things.
This, coupled with increased vigilance by the regulators, who are of course finding ways how to approach both current and new regulations, implies this technology comes at exactly the time that the industry must embrace it, bringing Luxembourg industry to a level that our rivals could well struggle to achieve.

Matt Elton, CEO of FinnoLux, and Co-founder and Vice-Chair of the International RegTech Association, concluded "The Maturity of many RegTech solutions, including those presented today, are really strengthening value to the financial services industry. The value proposition of RegTech solution is particularly applicable to the Luxembourg industry, and as the regulatory landscape continues to evolve on a daily basis, firms must turn to technology in order to be compliant and save costs. The Luxembourg industry has an opportunity to apply this value proposition to increase its competitiveness and to strengthen its position against other global centres."