Introducing themselves as a “KYC Utility”, i-Hub launched its services in December 2018 in collaboration with a major bank of Luxembourg. Other stakeholders such as fund managers and transfer agents soon expressed their interest. The platform, the only one of its kind, which enables the outsourcing of continuous updates and the mutualization of KYC records, has gathered much interest further to the cost increase of regulatory compliance and the growing penalties for lack of vigilance!
Data is and always will be at the heart of financial activities, and more specifically of regulated activities. The data related to customers – whether they are natural persons or legal entities – is undeniably strategic, and ensuring it is reliable and up-to-date is a major security challenge. Beyond the obvious business aspects, complying with the various regulations has kept costing more and more since the financial crisis of 2008.
Laws and regulations for the fight against money laundering, terrorist financing, corruption and frauds require a high level of vigilance from the financial institutions and other regulated bodies that must comply with them. In particular, they have to be able to identify, verify and categorise customers according to their risk level. In this aim, they rely on their own internal risk management policies before dealing with any new customer, and once the customer is approved, all along the business relationship.
“The challenge for the financial service industry is to be able to use the data amount and depth, be it data already available or to be acquired, so that they can meet the requirements of the most stringent regulators and improve the services offered to their customers, explained Pascal Morosini, CEO, i-Hub. And for good reason: the costs of acquiring and updating data, carrying out compliance checks and drawing up regulatory reports have kept increasing.”