Markit’s tie-up with business process specialist Genpact, which was made back in September 2013, has come to fruition in a Know Your Customer (KYC) service designed in conjunction with Citi, Deutsche Bank, HSBC and Morgan Stanley. Called Markit | Genpact KYC Services, the companies’ KYC offering is based on Markit’s Counterparty Manager service and Genpact’s Remediation as a Service platform.
An online portal, KYC.com, is open for bank clients, including asset managers, corporations and hedge funds, to register, upload documents and permission sell-side firms to access the data. Sell-side firms can access the service on a subscription basis with variable pricing depending on the number of entities required.
The institutions that were instrumental in designing the common standard and global framework for KYC data and document management included in the service were already users of Genpact processes and Markit’s Counterparty Manager service, which allows financial institutions and corporate customers to automate the sharing of regulatory information and KYC documents with banks. They are migrating to the centralised and more dynamic KYC service, while Markit and Genpact are working with other prospective users.
Joe Widner, managing director at Markit, explains: “The service provides a standardised end-to-end solution for collecting KYC data and documents, validating and enriching them, administering them and updated them on an ongoing basis. It takes out the core processing between deciding to do business with someone and doing business with them. The centralised nature of the service means customer data and documents are processed once and can be used by all subscribing banks. Another benefit is high quality data, delivered in a timely way and at a lower cost than was previously possible.”
Rampi Kandadai, senior vice president in the Financial Markets Solutions Group at Genpact, adds: “There is also an opportunity here to help clients of banks reduce the amount of time they spend on satisfying KYC requirements. For example, a large fund must provide data multiple times to a number of counterparty banks, but using a centralised service the fund can provide data once a year and the service can then update and distribute the data to the banks.”
The initial release of the service covers the US and UK, where banks must comply with KYC and anti-money laundering regulations including Dodd-Frank, European Market Infrastructure Regulation and the Foreign Account Tax Compliance Act (Fatca). Jurisdictions in Asia Pacific are on the roadmap and expected to be covered by the service over the next 12 months. Widner says: “We intend to build out global coverage. The standards we have created to help banks meet regulatory requirements in the US and UK are very high and will overlap with those of other jurisdictions, making it relatively easy to extend the service.”
Markit and Genpact are not first to market with a centralised KYC data solution and will compete with organisations such as Swift, Thomson Reuters and DTCC. Widner says: “We have based our KYC service on existing services from Markit and Genpact,
which means we have a depth of experience and great understanding of the market. Also, through these existing services we already have connections to banks and their clients, so it will be a natural progression for them to use our solution.”
Michele Trogni, managing director and global head of managed services at Markit, added: “We view KYC data management as the foundation for multiple other innovative services related to client information and are already working on complementary solutions.”