In Focus Consumer Credit


Digital onboarding is the key to business continuity


Digital customer identification is continuing to make progress, despite some popular misunderstanding


John Dobson Chief executive, SmartSearch john.dobson @smartsearch.com


The ongoing coronavirus pandemic has caused problems right across the economy. For the financial services sector, there have been particular issues caused by the difficulty in not meeting customers face to face.


Direct contact Many onboarding processes rely on that direct contact with customers, together with the use of physical ID documents such as passports and driving licences to verify customer identity. Some of the restrictions on travel and


meeting have now been eased, and the government is encouraging people to go back to work. However, there remains a presumption against face-to-face contact where it is not necessary, and a need for strict safety measures to be in place to minimise the risk of infection. On top of this, it has recently come to


light that because of reduced capacity during ‘lockdown’, key government agencies, such as the Passport Office and the DVLA, are now experiencing severe backlogs. This means that many customers could be lacking valid ID as they have not been able to obtain or renew these documents. At one point, when this issue hit the


airwaves, it was asserted on national television that it is not possible to buy a house without a valid passport, because of the need to establish and verify the ID of the transacting parties. Fortunately, it is not true – there are


solutions available that meet all the requirements for ID verification, without the need for any physical documents whatsoever. All that is needed is a name,


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address, and date of birth for a full set of checks, using multiple data sources, which can give a positive ID match in 95% of cases, in less than two seconds. By taking the documents out of the


equation, this also means the whole onboarding process can be conducted remotely and digitally, with no need to meet face to face, or entrust sensitive documents to the time-consuming vagaries of the post, or to expensive couriers.


Added benefits An electronic verification (EV) and digital onboarding solution can also bring added benefits. In line with increasingly stringent Money Laundering Regulations (MLR), customer due diligence can also be conducted electronically – including checking against relevant sanctions and Politically Exposed Persons (PEP) lists. And once a customer is onboarded, their status can be monitored


on an ongoing daily basis, and any change immediately notified.


‘Magnitsky-style’ This is not a minor consideration: as the government’s recent moves to implement a ‘Magnitsky-style’ regime in the UK show, sanctions lists can and do change. Recent weeks have seen further


By taking the documents out of the equation, this also means the whole onboarding process can be conducted remotely and digitally, with no need to meet face to face, or entrust sensitive documents to the time-consuming vagaries of the post, or to expensive couriers


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revelations about the extent to which organised crime, originating in Russia especially, has targeted the UK financial and property sectors. Firms need to be alert to this, even if the risk appears low, to ensure they remain compliant. Before the Covid-19 outbreak, manual


document checks were already looking like yesterday’s solution to tomorrow’s problem. Now, as we all look to adapt to the ‘new normal’ in which we find ourselves, the time has surely come to ditch the documents and discover the joys of digital onboarding. CCR


August 2020


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