Choosing Your KYC Solution:
How to Cut Costs and Satisfy Regulators

The Real Problem with KYC Isn't What You Think

Financial institutions face a dual threat: intense scrutiny from regulators demanding a robust, risk-based approach to compliance, and immense pressure from the business to control spiraling costs. Many leaders believe the primary issue is the sheer volume of alerts generated by their systems. The reality, however, is a more expensive and hidden problem that lies at the heart of their Know Your Customer (KYC) operations.

The most significant drain on KYC programs is the highly manual, inefficient process of data gathering. Analysts spend countless hours piecing together customer information from dozens of disconnected systems just to perform a basic periodic review or onboard a new client. This fragmentation makes it impossible to build the comprehensive, 360-degree customer view that regulators now demand. This manual work is not just slow and expensive; it is how critical risks are missed.

This guide presents a new framework for evaluating KYC software. It will show you how to move past the limitations of siloed tools and choose a platform that attacks the root cause of inefficiency–fragmented data–to build a truly effective and cost-efficient compliance program.

The High Cost of a Disconnected Customer View

The traditional approach to KYC, which relies on a patchwork of disconnected systems, is no longer sustainable. This technological failure creates massive operational friction and prevents institutions from truly understanding their risk exposure.

Manual Data Gathering Is the Silent Killer of Efficiency

Your KYC analysts' time is consumed by manually accessing 5, 10, or even 20 different systems to collect the data needed for a single review. This "swivel-chair" process of copying and pasting information is the primary driver of high operational costs and analyst burnout. It drastically increases the time required to complete investigations, creating huge backlogs and extending customer onboarding times. What's overwhelming many organizations is not just alert volume, it's also the inefficiency associated with reviewing an alert.

You Cannot Have a Risk-Based Approach Without Context

Regulators demand a dynamic, risk-based approach, but this is impossible without a holistic view of the customer. When data on beneficial ownership, transaction history, and corporate linkages are in separate systems, you cannot see the full context of risk. A seemingly low-risk customer may be two degrees away from a sanctioned entity, but this connection is invisible in a siloed environment. This lack of a 360-degree view directly impacts the effectiveness of your transaction monitoring systems, leading to a higher rate of false positives downstream because alerts lack the necessary KYC context for accurate evaluation.

From Manual Data Gathering to Automated Intelligence

A modern KYC solution is not just another application; it is a unified intelligence platform that connects all your relevant data sources into a single, cohesive view. By using a knowledge graph, DataWalk automatically fuses disparate data and resolves entities, eliminating the manual work that plagues traditional processes. This provides the foundational 360-degree view required for effective risk management.

Achieve a True 360-Degree Customer View

The DataWalk platform connects all your data--from core banking systems, CRMs, and external sources--into one place. This automates the difficult work of entity resolution, ensuring you know when "John Smith" in one system is the same person as "J. Smith" in another. This provides a complete picture of customers, their accounts, their relationships, and their network of connections, which is essential for accurate risk assessment, as detailed in the whitepaper, Connecting the Dots with Graph Analytics .

Build and Adapt Risk Models Instantly

In a volatile world, you need to respond to new criminal typologies immediately. A no-code, visual environment allows your compliance experts - the people who understand the risks - to create, test, and deploy new risk-scoring rules and monitoring scenarios without writing code. This agility allows you to tailor your risk-based approach to your specific needs and adapt in hours. This capability was demonstrated in our ING Bank case study , where a complex monitoring solution was deployed in just six months to meet urgent regulatory demands.

Enable Meaningful Perpetual KYC (pKYC)

With a unified and continuously updated customer profile, you can move beyond arbitrary periodic reviews. DataWalk can automatically monitor for material changes in a customer's behavior or network connections, triggering a review only when a meaningful risk indicator appears. This transforms KYC from a static, backward-looking exercise into a proactive, forward-looking process. The methodology for this is outlined in the 5-Step Guide to Streamlining Perpetual Customer Behavior Monitoring.

From Managing Paperwork to Actively Managing Risk

Continuing to operate with disconnected KYC tools is no longer viable. The endless cycle of manual data gathering is too expensive, too slow, and leaves your institution blind to sophisticated, networked risks. The path forward requires a fundamental shift from fragmented applications to a single, unified intelligence platform.

By automating data fusion and providing a complete 360-degree view of every customer, you can eliminate the manual work that cripples your compliance team, build a truly effective risk-based approach that satisfies regulators, and turn your compliance function into a strategic asset that protects the institution.