Nearly 40 percent of UK businesses have deliberately abandoned their attempts to open a new banking services in the last year due to “slow due diligence”, according to a survey by regtech specialist Encompass Corporation, which pointed to clunky, time-consuming Know Your Customer (KYC) processes.
The survey, conducted between March 18-19, just after the Chancellor announced a £330 billion rescue package due to support UK companies through the Covid-19 crisis, asked businesses about the challenges they face in accessing financial support, as well as attitudes towards cyber security and regulation.
Wayne Johnson, CEO and co-founder, Encompass said: “Everyone recognises that it’s vital to ensure correct background checks on new customers to prevent money laundering and criminal activity, but these checks should not act as a hindrance to legitimate companies gaining access to [credit and services].”
Needless to say, Encompass has “skin in the game” — the company automates the KYC discovery process for corporate and banking customers — but the report echoes concerns raised elsewhere. (The founder of award-winning gold trading startup Goldex, Sylvia Carrasco, recently told Computer Business Review that despite her company having hugely robust KYC processes in place it was initially nigh impossible to open a business bank account with one of the established High Street banks in the UK.)