KYB Done Right: Strategies for Streamlined Compliance and Onboarding

As the Chief Product Officer at a company innovating in the KYB space, we have the privilege of working with a diverse range of clients—from B2B cross-border payments providers to digital marketplaces and crypto platforms. 

Each industry brings its own unique challenges when it comes to onboarding. Over time, we've gained valuable insights into what makes or breaks a successful KYB transformation. In this article, I’ll share some key lessons we've learned from helping businesses along the way. 

Before we delve into the details it’s probably worth taking a step back at what KYB is and why it’s so important. 

• It's a process companies use to verify the identity and legitimacy of other businesses they interact with.
• The process is full lifecycle, from initial onboarding through to ongoing monitoring.
• It includes KYC of Directors and Ultimate
Beneficial Owners (or any other people types required) 

This process is essential to get right as it’s typically amongst the first few interactions that a business has with you. They’re excited for their new product, you are excited about landing that new client and also the revenue that comes with it. But also it’s controlling who you do business with and the risk associated. Which with fraud, and the associated regulation on the rise is becoming increasingly complex.

In the rest of this article, I'll discuss some of the key lessons we’ve learnt, often the hard way, when implementing a new KYB tool like Detected.

Cross-Team Buy-In Is Essential

KYB and onboarding is a complex process that typically spans multiple departments, each with its own requirements. While compliance teams often lead the charge, teams from Sales, Operations, Technology, and Customer Support all have a stake in the KYB process. This can lead to strong opinions and competing priorities, which—if not managed well—can slow progress and even derail the bestintentioned and most needed projects. 

The question is, how do you successfully navigate these teams and challenges? 

Our background and experience with Detected is proudly not solely focussed on compliance and KYB. By bringing in best practices from adjacent sectors we bring skills in change management, technology, product, and client support and run it like a digital transformation. It’s amazing how many times you ask the question of “why do you ask that” and the answer is “we’ve always asked for that”. Our approach is simple: 

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Define Clear Goals and Vision:
We define clear goals and KPI’s and are led by the data (discussed later) - Time to Value, Churn Rates, Net promoter scores, Automation rates all become the backbone of our projects and are constantly revisited.

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Learn from the current, but bring our expertise:
Understand your current technology, processes and pain points. But it’s often an external point of view that can be most beneficial here. Let us use our knowledge of our Risk, Fraud and Compliance network to help remove your pain points such as having to request documents or data about UBO’s that are publicly available.

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Have the right technology, configured in the right way:
This is the easy part - Choose Detected! But configure it to meet your needs and user experience. Onboarding clients from China, make sure you are using the best data sources, with maximum coverage of Directors, UBO’s and request IDV documents with the best success rates. 

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Engage and Train Employees

It’s key that Users at all stages of the business know how to use it. At Detected we’ve got an extensive knowledge base, product, videos and perform in person training for all teams involved in the process. Continuing the buy-in and ensuring the engagement of all within the project is essential. 

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Measure and Optimise:

Again, we’ll talk about the data later. But ensuring the constant feedback loop is in place to measure and learn is key. Identifying pain points, and optimisations is a key drive of success. We undertake extensive “hyper-care” for all projects where data is reviewed by our teams daily, our BI platform is updated in real-time and we have the capability to implement changes daily to optimise as quickly as possible. 

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Don't Just Replicate the Old Process, Embrace the new

One of the biggest mistakes we’ve seen is businesses trying to simply "replace" their outdated KYB processes with new technology—without reevaluating the underlying problems and opportunities. The reason you’re adopting a new solution like Detected is that your current process is broken.  

We see and understand that processes have typically evolved over time, away from the best intentions. New regulations have been bootstrapped in and we’ll just add this additional field or request this check accumulates over time. 

To truly transform KYB, businesses need to start with a clean slate. This requires not just new technology, but a fundamental shift in how the entire organisation approaches compliance and onboarding. To do this, we recommend assigning internal champions within each department that has a stake in the onboarding process to drive this change. This helps to not only speed up adoption, but improves the feedback loop for any further potential improvements.

What should the clean slate look like? 

Optimise for the 90% rather than the 10%. A one-size-fits-all all approach doesn’t work. That’s why we created Detected. Focus on what is required to be captured to meet your regulatory obligations and your risk appetites. 

However, even with extensive data, screenings, workflows and automation there will always be businesses and applicants that don’t fit the norm, the complex cases that require human intervention. For example, trying to onboard offshore trusts based in the British Virgin Islands is very different to onboarding a Medium sized UK business. Use the Ecomm approach and focus on the “Happy Path”.

Start by targeting your core and expand from there

Every business we’ve worked with has their core business types and jurisdictions that they know best. Identify these and target them. Configure your workflows, automations and approach for these. Then gradually build out from your core into more complex regions and cases.  

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Embrace the data 

Use the latest technology and utilise as much available data from the best data sources to reduce the burden on your users. This requires a change in compliance rules and logic to be forward thinking to adopt these new technologies. A great example of this is IDV. Using eIDV solutions such as GBG ID3 Global to perform AML and compliance checks instead of asking a user to provide an ID document can improve onboarding churn rates by 40%. 

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Only ask users for what’s necessary 

Leveraging the above data means that you request only the data that isn’t available. For example, this could be company specific information such as the split of payment types. But it’s important again to only optimise for the 90% here. Don’t ask all users to provide information just because a certain group might be required to provide it. (We’ve also built the functionality for seamless followups if it’s required!)

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Continuous Optimisation Is Key

At Detected, we’ve built our platform to automate as much of the onboarding process as possible. Users expect instant results in today's instant economy. Onboarding experiences like Monzo’s and Revolut’s provide instant access and the days of a user being happy to wait days for access to an account or service are a thing of the past. 

From day one, we set ambitious goals to maximise automation, but for optimal results, continuous learning and improvement are essential. This approach allows us to automate further and increase the percentages that can instantly be approved, allowing analysts to focus on the medium/high risk cases. In turn, also allowing businesses that may have been turned away as too risky to be fully analysed and onboarded. This approach also allows us to constantly adapt to risk models, changing regulations and product needs. 

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Companies and teams that embrace the data and analytics provided by our platform see the greatest improvements in speed and efficiency. By its very nature our system is designed to track and analyse every step of the onboarding journey, providing more data on KYB than businesses have ever had before. Our e-commerce background allows us to use what’s defacto standard there and apply it to KYB, Using behavioural analytics, heatmaps, session replays and engagement metrics allows us to identify friction points in journeys, target specific problem documents or more challenging jurisdictions where users get sub-optimal experiences. In a recent example, we saw that in China, users who provided National ID cards were onboarding twice as fast as those that had been requested to provide passports and additional documentation was required in half as many cases. A simple tweak in the onboarding policy that led to both speed and efficiency improvements. 

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If we take the example of one of our biggest enterprise clients, they were flying blind when it came to onboarding analytics, caused by manual processes, separate systems and poor quality data. Over the course of the first 3 months of their engagement we’ve seen a reduction in onboarding times by over 80%. 

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The most successful organisations are those that constantly review this data, Sales need to be obsessed by their funnel. Compliance needs to be obsessed by their approval rates and Product and technology need to be obsessed by their onboarding UX and UI. Only by having all these teams involved can you refine processes, policies and workflows in near real time to get the results required. 

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In summary, Onboarding and KYB may seem like a simple change, but it’s complex and ever changing. We are continually learning and adapting our product (with weekly releases) to adapt to the challenges we see. And are constantly learning and adapting how we help businesses transform their KYB process with great effect.

If any of the above resonates with you, I'd be more than happy to discuss and explain our approach and platform further. 

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