Client satisfaction starts with digital onboarding

By John Leahy Senior Product Manager
July 20th 2022

Delivering a smooth, hassle-free onboarding experience to high-value clients, while ensuring they are properly vetted in line with internal and regulatory compliance standards is a tricky balancing act. Thorough checks can cause delays in approving prospective clients, which may leave them so frustrated they drop out of the application process and turn to a rival provider instead. But without a robust onboarding framework, mistakes can all too easily occur, risking hefty fines and lasting reputational damage.

Wealth management growth adds to onboarding challenges

And it’s a balancing act that is only getting more important. A new Bain & Company report predicts customer demand for wealth management services will double the market’s size by 2030, taking revenues to more than $500 billion. With wealth management growth set to outpace asset management by an average of 2% a year until 2030, asset managers and brokerages are rushing into the wealth space to service a fast expanding and changing client base.

Faced with this kind of growth, how can financial institutions avoid the backlogs and client dissatisfaction woes so prevalent across the financial industry.

The answer is either:

  1. to ramp up staffing levels to cope with the increased workload (with the costs and risks that brings), or
  2. adopt an intelligent digital onboarding model.

Option a is where many investment managers and banks are at the moment. Their account set-up processes tend to be laborious and error prone – not a good combination when regulators around the world are tightening their anti-money laundering (AML) and know your customer (KYC) rules.

Investor onboarding teams often have to perform hundreds of manual tasks every day to verify the identity, and assess the risk and suitability of each new customer. Typically that involves numerous back-and-forth interactions between investment manager and client, with lots of paper deliverables (which are often still mailed or faxed). Employees may need to re-key the same data into multiple systems and spreadsheets, manually access third-party systems and liaise with different teams across the globe. The data then sits in different departments with no single source of the truth.

Digital scalability

The alternative is a digitised, automated investor onboarding process. It is faster, simpler, more scalable and delivers the compliance rigour regulators seek.

Secure digital forms that guide investors with a step-by-step walkthrough of the subscription process allow prospects to upload their data securely, when they want, via their device of choice. Inputting data in a structured format ensures each relevant section is completed accurately, with the validated information feeding straight into the transfer agency system. Electronic signatures – a digital code generated and authenticated by public key encryption and attached to an electronically transmitted document – verify the document’s contents and sender’s identity.

Customisable, risk-based AML/KYC processes, combined with advanced investor and beneficial owner screening, source of wealth (SoW) checks and automated document checklists then ensure the firm’s compliance responsibilities have been met and all parts of the onboarding function are fully controlled.

The result is an efficient, user-friendly electronic experience. Clients get the fast, seamless onboarding experience they want. Regulators are assured that all the proper AML/KYC, beneficial owner and SoW checks have been performed. And financial institutions can onboard more clients at a lower cost and with less risk.

It’s a win-win-win solution.

ABOUT DEEP POOL
Deep Pool is the #1 investor servicing and compliance solutions supplier, providing cutting-edge software and consulting services to the world’s leading fund administrators and asset managers. Our flexible solution suite, developed by an experienced team of accountants, business analysts and software engineers, supports offshore and onshore hedge funds, partnerships, private equity vehicles, retail funds and regulated financial firms. Deep Pool is a global organisation with offices in Dublin, Ireland, the United States, the Cayman Islands and Slovakia. For more information, visit: www.deep-pool.com.

 

 

John Leahy
John has been with the Deep Pool Group since 2012. He drives product development, vision, strategy, and execution across a cross-functional team, serving 3 Fintech/Regtech products. John holds a Postgraduate Diploma in Product Management from Technological University Dublin.