A Balancing Act between Customer Safety and Customer Satisfaction

The realm of digital finance is rapidly progressing, fueled by technological advancements and the needs of users.?This significant movement presents both exciting prospects and potential dangers for financial institutions.?While there are potential risks of exploiting technological and procedural vulnerabilities to carry out sophisticated cyber-crimes, the very nature of technology enables F.I.s to reduce operational expenses and introduce groundbreaking offerings to the market.

Based on our observations, numerous financial institutions (F.I.s) are prioritizing the digitization of their product offerings and business strategies, often outpacing the progress of their Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) processes. However, there are other F.I.s who are diligently working on establishing business models supported by comprehensive, and regulatory-compliant AML/CFT procedures across their entire organization. While this approach is commendable, it can become problematic if the sole focus is on satisfying regulatory requirements without considering the broader impact. The sustainable solution lies in F.I.s adopting a technology-driven approach to AML/CFT that proactively anticipates regulatory changes while prioritizing customer needs. This is especially necessitated by the highly complex and evolutionary nature of cyber-crimes in current and future digital eras.?When well executed, this approach will not only aid in combating cyber crime but also aid in operational efficiency and optimized customer experience.?

Here are few tips to get you started:

i)??Start from within by fostering a culture of safety and innovation. When values such as safety drive organizational practices, AML/CFT is no longer a necessary nuisance but rather, a personal statement of employees’ stand against crime.

?It is crucial to establish robust and forward-thinking internal systems. A notable advantage of implementing such systems is their effectiveness in combating financial crime and minimizing risks that could impact an organization’s financial performance. These systems play a pivotal role in safeguarding the organization’s bottom line.

?Furthermore, by equipping employees with state-of-the-art tools, it helps in enhancing their work capabilities and serves as a tangible demonstration of management’s unwavering commitment to the AML/CFT Program. This, in turn generates a ripple effect amongst the employees, fostering a sense of enthusiasm and motivation towards maintaining and strengthening the program.?

As an innovative fintech of the future, Clydestone offers TheONE, an Authentication as a Service (AaaS) platform which enables robust, end-to-end, multi-factor authentication for F.I.s, cost effectively.

TheONE enables multifactor authentication through one-time password tokens and biometric signatures within a multi-tenant environment. Subscribers also have access to a software development kit, which can be utilised to set up and customize application protection.

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ii)?Automate Customer Due Diligence

Use a software solution that makes the customer due diligence process easy. Clydestone provides a platform that helps to simplify KYC, detect sanctioned entities and flag suspicious persons for further investigation. This robust platform also offers quick and comprehensive PEP Checks, Sanctions Checks, Adverse Media Checks, KYC, amongst others.

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iii)??Do Not Leave the Customer Out.

In order to create a customer-centric AML/CFT program that stays ahead of the regulatory curve, it is important to understand customer behaviour as well as anticipate and prepare for future patterns. Clydestone’s TheONE makes it easy to spot anomalies in customer behaviour which can trigger fraud alerts as well as scale up protection where required. The above, combined with continuous customer education on fraud prevention is the best way to ensure customer-centricity in ML/TF mitigation.

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iv)???????Ensure Continuous Evaluation and Improvement

There is always room to grow. Have a dedicated team that ensures continuous research, testing and improvement of the AML/CFT program.?

In AML/CFT, financial institutions face a paradox that demands their attention. On one hand, the rise of increasingly sophisticated cybercrimes, such as account take over, man in the middle attacks, and card fraud, can erode user confidence.?However, these very users expect a reliable and effortless experience across various channels, even while on the move. Balancing these duo demands requires strategic measures and innovative solutions to provide both robust security and a seamless user experience.

Without a powerful and cost-efficient authentication solution like TheONE, which facilitates delivery of a consistent service across all customer touch points in real time, F.I.s risk running multiple authentication checks in silos, causing too much friction in the user experience. Heightened exposure to cybercrime and subsequent monetary losses are a high price to pay and will interrupt an AML/CFT program that is not technologically inclined.

As Africa’s trusted #FintechoftheFuture, Clydestone has the capacity to deliver cutting-edge technologies that help companies deliver excellent customer experience as the driving force of a robust AML/CFT program. Email us via ?[email protected] for more discussions.??