Implementation of Robotic Process Automation To Decrease the Time Requires For KYC Onboarding Process

The “Know Your Customer” (KYC) process is a critical aspect of financial services, aimed at preventing money laundering and terrorism financing. However, KYC data accuracy and reliability are often challenging to maintain as they require manual effort, leading to errors and high costs for financial institutions. In this study, we propose an automation model based on Robotic Process Automation (RPA) with machine learning capabilities to automate the tedious tasks of customer onboarding. The proposed system quickly verifies KYC documents and entry the data in the bank CRM, automatically connect to international sanction-list to establish the client risk profile. The bot ensures the accuracy of KYC data by handling the document update process with an email assistant. Our results demonstrate that the RPA-based automation model drastically reduces KYC documentation verification time while accurately assessing customer risk profiles. The proposed system enables banks to reduce both system duration and cost, and can be implemented easily. Specifically, the study results show that KYC document checks were significantly reduced from 30 minutes to less than one minute, leading to considerable reductions in the overall processing time.

I. Introduction

The Know Your Customer (KYC) process is a critical component of the banking industry, serving as the first line of defense against financial crime. KYC onboarding is a complex process that involves verifying the identity of customers and assessing their risk levels. However, the current manual KYC onboarding process is time-consuming and prone to errors, leading to delays and compliance risks [1]. West Africa governments in their fight against terror financing, paid particular attention to the Financial Action Task Force (FAT) standard recommendations on KYC, which were updated in march 2022. The exponential growth of customer data and the increasing number of regulatory requirements further complicate the process. ¹

The Financial Action Task Force (FATF) is an independent inter-governmental body that develops and promotes policies to protect the global financial system against money laundering, terrorist financing and the financing of proliferation of weapons of mass destruction.