to help locate a judgment debtor ’ s assets for collection purposes .
As there is increased digitalization of credit processes , a completed and signed digital credit application is the first step in a KYC check . A digital credit application will help protect a company through the following processes :
To identify customer and ownership
Completing a credit application on a digital platform will give you the customer ’ s full legal name , legal type / structure of the company and their tax or Federal Identification Number . It ’ s also important to get the other names your customer may go by . In addition , the seller will get a full picture of ownership , which could prove helpful in any future legal dispute .
Verify authenticity through due diligence Simply put , acquiring some basic facts about your customer through a credit application will help in your KYC check . Getting a full address , date of incorporation , phone number as well as key management and directors will go a long way in verifying your customer ’ s authenticity .
Supplier , bank and credit checks
Having your customers ’ other suppliers ’ update their payment history can help avoid loss by alerting you to any unusual or late payment activity . Check bank data through a secure third-party partner . Their financial partners perform their own due diligence on your customers and are subject to strict checks of illicit activities .
Continuous monitoring
In the case of credit applications , it ' s important to do periodic checks on your customer . A new application should be signed and completed by your customers at least once a year .
When executing a customer-centric strategy , knowing your customer is the first crucial step to set the ball rolling . To get a better picture of your customer , it is vital to dissect the raw data available to you .
In the new normal for KYC compliance , the colossal changes that the world witnessed since the beginning of the Covid-19 pandemic are also redefining the new normal for KYC compliance .
The current status of KYC compliance is one characterized by crucial transitions in all its aspects . This transition is part of the overall digital transformation trend that has characterized financial services for a while . However , it was drastically accelerated by the Covid-19 pandemic .
The future of compliance , the world of KYC compliance is currently at a turning point . In 2020 , a series of trends that had been in the making for years , combined with the unprecedented circumstances brought about by the coronavirus pandemic , culminating in structural changes in the overall KYC compliance function at financial institutions around the world .
This colossal shift is bound to shape the face of the sector for at least the next decade . Those financial institutions able to embrace change quickly and effectively will gain a competitive advantage that other contenders will struggle to match .
Wasilwa Miriongi is a Certified Credit Professional currently working as the Managing Director , Del Creder Credit Management Limited . You can engage him on this or related matters via email at : WMiriongi @ gmail . com .