How to Rank the Best KYC/AML Software Solutions – A Practical Guide

How to rank the best KYC/AML software solutions is a question a lot of compliance officers ask themselves – and we, as a provider of what we consider to be the absolute best KYC/AML software solution in the market, often ask ourselves as well.

As our client onboarding platform is all about grading and giving scores (which is a topic for an entirely different blog post), we thought it would be good to create a ranking system that can help compliance officers and onboarding teams decide what the best KYC/AML software solutions are.

This, of course, is just one way to grade the best KYC/AML software solutions. Your way could be entirely different – you could weigh the parameters below differently, or add entirely different parameters, ones we don’t even consider to be pertinent. That’s completely okay – the most important thing, in our mind, when trying to decide what the best KYC/AML software solutions in the market are, is to have a comparison methodology. A system. And that, in fact, brings us to our first parameter – Order.

Best KYC/AML Software Solutions Parameter Number 1 – Order in Chaos

One of the most common challenges we hear from clients is that they spend a lot of time making sure they have everything in order, in the most basic of ways: gathering, sorting and filing. Meaning, they spend a lot of time and effort on administrative tasks, just to make sure they don’t end up missing a document or losing an ID.

“Compliance is 90% logistics”, a wise, old compliance officer once said (whose name lies safe with us), and therefore we believe that the best KYC/AML software solutions should save the onboarding team the administrative hassle.

They can do that by a myriad of ways, the most simple and straightforward is to act both as a single gathering point AND as a single storing point for the financial institution. The best KYC/AML software solutions, therefore, have the trait of a CRM (Customer Relationship Management system), or, at least, are able to easily and fully integrate into one.

As administration accounts for 90% of compliance, we’ll weigh this parameter quite heavily (though, no offense to that wise old compliance officer, not at 90% of the grade), and give it 20 comply-points (catchy, isn’t it?).

This means that if a KYC/AML software solution wishes to be amongst the best KYC/AML software solutions, it should, in our mind, be able to relieve the financial institution from a significant administrative headache.

Weight: 20 comply-points.

Best KYC/AML Software Solutions Parameter Number 2 – Coverage

Other very common questions we’re asked by prospective clients refer to coverage: “What countries do you cover?” “What documents do you receive in those countries?” “What kind of checks can you perform in each of those countries?”

Those questions are understandable – financial institutions these days are global enterprises, and not being able to onboard clients from certain jurisdictions due to lack of ability to perform client due diligence in that jurisdiction, means, simply, loss of income.

This drives many financial institutions to adopt several KYC/AML software solutions at the same time, which is, of course, not a bad thing in itself; but it does make things, usually, more difficult to handle. To onboard clients from one jurisdiction this KYC/AML software solution needs to be deployed; to onboard clients from another jurisdiction that KYC/AML software solution needs to be used; and so on and so forth. And then, of course, there are multiple integrations, multiple invoices… multiple headaches, in short.

In our mind, the best KYC/AML software solutions are the ones with the most coverage, allowing the financial institution the most coverage for its buck. As this is something that, in our experience, is important to our clients (who like the fact that our client onboarding platform links to multiple data sources, giving them many-in-one access to near-global coverage), we weigh this at 15 comply-points.

Weight: 15 comply-points.

Best KYC/AML Software Solutions Parameter Numbers 3 & 4 – Extent and Depth of Automation

In a previous blog post, we analysed the different kinds of KYC/AML software solutions out there. In short, there are those who automate a small part of the client onboarding process (which we dubbed: “the Data-Finders”); those who digitize, but not really automate, the whole client onboarding process (which we dubbed: “the Workflow”); and our own KYC/AML software solution, which takes the best of both worlds, and automates the entire client onboarding platform (which we, modestly, dubbed: “the Ultimate Solution”).

Building on the take-aways from the said blog post, we now offer a third and fourth parameter for the assessment of the best KYC/AML software solutions:

Extent of automation – this relates to how much of the client onboarding process is automated (in our view, it should be entirely automated,  including everything from its regulatory aspects like Suitability & Appropriateness and Client Categorisation, to the normal checks like IDV, PEPs, Sanctions etc., to complete client risk assessments and all the way to monitoring the client throughout the relationship with the client). Conservatively, we weigh this parameter at 10 comply-points.  

Depth of automation – the term “automation” tends to mean different things to different people. In our humble opinion, the best KYC/AML software solutions are like an auto-pilot. They allow you to onboard clients almost without effort. The best KYC/AML software solutions let you set the destination, set the parameters, and allow you full control – without any of the hassle, just like an aircraft’s auto-pilot. This parameter, although important, is also a bit advanced, so we weigh it at only 5 comply-points.

How to Rank the Best KYC/AML Software Solutions – Return of the Practical Guide

This brings us to 50 comply-points; out of around 100. We’ll stop this blog post now, and continue it in our next blog post, which we’ll title, appropriately: “How to Rank the Best KYC/AML Software Solutions – Return of the Practical Guide” (it will be named either that, or “How to Rank the Best KYC/AML Software Solutions – Compliance Strikes Again”- we’re not sure quite yet).  

Spoiler alert – on the menu next time we’ll have the seven deadly sins of customer experience (complexity, repetition, sluggishness, bad drafting, undependability and more); how much value does the KYC/AML software solution add to your business; and how well can you sleep at night after adopting said KYC/AML software solution.

All that and more in our next episode – How to Rank the Best KYC/AML Software Solutions – Return of the Practical Guide!