Over the next three to five years investment and corporate banks will adopt a hybrid model for carrying out KYC (Know Your Customer) checks. Whilst the idea of an industry-wide utility that provides all the screening data a bank requires is financially attractive the utilities will not provide complete coverage across the geographies and customer-bases of most banks. Therefore even if a bank signs up for one or more utilities it will have to source quite a lot of its KYC data via another route.
Lysis sees four principle model options and over time expects most banks to follow a hybrid of two or more of these models depending on their size, geographic coverage and customer mix:

  • Model 1 – Execute KYC internally using an in-house team.
  • Model 2 – Bilaterally outsource KYC execution to one or more third parties
  • Model 3 – Industry-wide utilities
  • Model 4 – A joint-venture (JV) utility with select other banks with a similar customer-base in a specific region

Lysis’s experience of KYC operations, our skills in designing and implementing effective cross-entity operating models and our knowledge of working with a number of the KYC Utilities enable us to provide advice to banks seeking to determine the most effective KYC operational strategy to adopt for the future and to design an operating model which makes the optimum use of in-house, utility and 3rd-party data provider capabilities.

Lysis also has experience of implementing and integrating utility services in to the infrastructures of our clients.