Northern Trust Looks to Facial Recognition for KYC

Northern Trust is building out facial recognition functionality and is developing the ability to provide access to its services through multiple devices.  

For that first piece, the bank’s technology arm looks to automate the processes around know-your-customer (KYC) and anti-money-laundering (AML) using facial recognition technology. According to Laurence Everitt, head of global fund services, it is expected to make tasks such as onboarding new investors more efficient than existing, traditional methods—adding that the registering process could take minutes as opposed to months.

“If you are a new investor and you are investing in a fund, you have to provide lots of paperwork—this might be a passport, a driver’s license or a utility bill, which is a very old way of completing KYC,” Everitt says.

Northern Trust is also developing the capability to allow asset managers, investors and independent financial advisors to consume its data via any device, including mobile phones, tablets, laptops or desktops. The functionality aims to offer clients the flexibility to access and manage their investment accounts at any time. As one example, investors will be able to track activity and will receive an SMS message every time a fund transaction is made.

• READ MORE: KYC/AML requirements are only becoming more complex for a variety of reasons. Slowdowns in the onboarding process mean loss of money, fines and increased reputational risk. Technology can help, but there is still a long way to go. Click here to read WatersTechnology’s deep-dive on the subject.

The new personalized capabilities look to reflect the way that retail banks and big tech firms are trying to roll out these technologies. Everitt explains that the asset management industry has lagged behind other industries in providing a richer digital experience to users.

He says that the new functionality will be delivered to the market “very soon,” but was reluctant to provide an exact date on their release, as it fits in within the bank’s overarching and complex digital program.

“We are recognizing that there is a market demand for this and we are keen to release the functionality as soon as possible, but again, we are working hard to make sure that we do it in the timeline, that it’s internally understood first before we start committing to the market,” Everitt added.

The new functionalities are part of a wider multi-year data and digital strategy that involves creating a centralized data architecture where each individual piece of data is identified and tagged. The largescale project also involves the development of individual application programming interfaces (APIs) between underlying systems to enable them to effectively communicate.

In later stages of the multi-year project, the bank will also look to also use machine-learning tools to develop insights from user activity and create a more customized user experience in the future. 

“Artificial intelligence tools will be able to, over time, learn the behaviors of consumers of that data,” he says. “It is very much the same as we see with Amazon Prime or Google, as those engines are learning from our buying behavior and [similarly we will] present personalized experiences to the investor.”