KYC Revolution: Automated Solutions Tackle Compliance and Fraud Challenges

Traditional know-your-customer processes— which are often manual and only conducted during customer onboarding—fail to adequately detect fraud and money laundering. By continuing to rely on legacy KYC processes rather than automated and ongoing KYC (dubbed perpetual KYC), banks will be left open to regulatory scrutiny and fines. By implementing perpetual KYC solutions—which utilize the power of AI and machine learning to vet and validate customers throughout the entire account lifecycle—banks can verify customer identification, assess risk, monitor customer accounts and behavior, and alert bank systems of anomalies or fraud signals, all in real time. 

This Javelin Strategy & Research report reviews the must-haves in KYC and outlines a maturity model for KYC deployment of advanced KYC systems. This report further explains how anticipated regulatory updates will make perpetual KYC the wave of the future—helping to address compliance concerns, mitigate the risks of money laundering and fraud in real time, and build customer trust.

Key questions discussed in this report: 

• Isn’t KYC at onboarding sufficient for regulatory requirements? 
• How do perpetual KYC processes differ from traditional KYC processes? 
• How can KYC be implemented without causing customer friction and privacy concerns?

Companies Mentioned: 

Department of Justice, FinCEN, Moody’s, Persona, TD Bank, iDenfy