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Keeping up with the neobanks; what it means for AML

The swiftness and simplicity of neobanks are redefining banking experience for a new generation of tech-savvy customers. What does this mean for anti-money laundering compliance?

Mariya Pattara
November 1, 2023

From weeks to seconds: How neobanks have redefined banking experiences

The swiftness and simplicity of neo-banks have attracted a generation of tech-savvy consumers. A few decades ago, opening a bank account in a brick-and-mortar branch meant a commute carrying physical IDs, filling out lengthy verification forms, and a few weeks of waiting period for the customer. Neo-banks and challenger banks have replaced this with fast and modernised onboarding processes which are mobile-first. This ensures you get access to financial services from the comfort of your home, or from anywhere in the world with an internet connection.

Neobanks have prioritised user experience, making onboarding a seamless, intuitive process. Their aesthetically pleasing mobile-first and user-friendly interfaces guide customers through each step, ensuring a clear understanding of the requirements and options available. With features like facial recognition, biometric authentication, and electronic signatures, they have eliminated the need for physical paperwork and signatures, further expediting the onboarding process to set up accounts in a matter of minutes rather than days or weeks. In fact, leading neo-banks now compete and take pride in the low number of customer clicks and minutes required to access their financial products and services.

Racing against time: the need for risk assessments that can keep up

In this race against time, the stakes are high. With each swift click, they must seamlessly navigate a landscape of compliance and security, ensuring every customer aboard is legitimate and trustworthy. Where customers require instant gratification and are intolerant towards any extra admin step, banks should keep up with real-time and accurate screening procedures that avoid any unnecessary disruptions to customer experience.  

A robust, modernised anti-money laundering (AML) compliance strategy can keep pace with the bank’s innovation to preserve trust in their products, while also maintaining customer experience.  

Next-gen Screening solutions: what it means for you

To complement seamless customer journeys without disruptions in your offering, banks should adopt modernised next-gen Client Screening solutions that support real-time screening for instant onboarding without excessive risk or disruption from false positives. This helps achieve regulatory compliance from the first moment of a new customer relationship, avoiding risks associated with delayed batch processing.  

Solutions that support multiple screening configurations in a single instance, partitioned to meet data residency regulations around countries and entities ensures consistency and eliminate technical debt. Artificial Intelligence tuned to the bespoke risk appetite of your institution trained to recognise what a good match looks like helps further reduce false positives so that your compliance teams can focus on truly suspicious activity. Adopting such next-gen screening solutions can thus transform your financial crime compliance processes from being a regulatory chore into a source of competitive advantage.

We’ve put together a whitepaper ‘Sharpening Sanctions Compliance with NextGen Client Screening’ with step-by-step instructions on how financial institutions can adopt a robust screening strategy. Download here


Photo by Gilles Lambert on Unsplash

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