Despite the increasing regulatory scrutiny surrounding KYB compliance, many financial institutions still rely on static entity databases to verify the legitimacy of their business partners and customers.
However, these traditional sources – which are only updated at intervals and do not provide the required documentary evidence – are not enough to appease the regulator and protect regulated businesses from money laundering risks.
Real-time access to company registries, on the other hand, provides the most accurate information about a company, including up-to-the-second changes in ownership, directors, and other essential details.
Moreover, using static databases for KYB verification not only leaves businesses vulnerable to potential risks but could also hinder their ability to onboard newly incorporated clients. In fact, our research revealed that an average 9% of all companies present in the registries were incorporated in the course of the last year for which data was available. These companies would not be present in a traditional database and, as such, standardised onboarding procedures that do not include real-time registry access would not apply to a vast and highly strategic market segment (newly born companies are often in urgent need of financial services such as a business bank account, loans, insurance coverage or other types of financing).
By integrating real-time registry access and automated UBO mapping, compliance teams can better protect their business against risk and provide an optimal onboarding experience to business customers. It doesn’t matter if the company was incorporated yesterday or ten years ago: the information presented to compliance teams by the Know Your Customer solution will always be the most up-to-date, sourced directly from the relevant company registry.
