Webinar: Focus on Digital Innovation, EKYC & AML (Malaysia & APAC)

okay if we can have frederick um so what what will happen during this session is we have our panelists here but uh we will have also five-minute introduction by all the panelists so we'll start with frederick first and then forward with cliff and then robin so frederick is representing ekyc company uh jumeil cliff is representing dow jones and robin is representing neighbor ai so what we do is we have this

five-minute presentation as you know um in the fintech world and finance and banking world or tech fin world what will always happen is there's normally a user onboarding and then what happened is the onboarding will link to a data company and and then it will be followed with empty money laundering so i will not go into too much details i'll let the panelists do their part show their expertise and what they know frederic the floor is yours thank you

jenna uh just let me share screen okay so good afternoon everyone um well welcome to the session today and thank you for taking time to join us uh uh on on this webinar event uh hi i'm frederick hole i'm the vice

president for gmail based out of singapore and my team looks after the business and customers across the apec region um so today i i wanted to use this time to to introduce jumio as our services in ekyc where we are an ai powered service delivering identity verification for online businesses so we have been in business for 10 years and in 10 years we have

to date handle over 250 million identities verified worldwide so that that is a huge database baseline for us to build our ai and machine learning on um we provide a global service through identity document types from over 200 countries so that that gives our clients the global reach in terms of uh their digital business uh our service basically comprises of expertise

dealing with identity document types verifying them and identifying if these id documents are authentic the accuracy rates have made us very successful delivering what we have built in terms of ability to produce and and verify identity documents with ability to have a high accuracy rates as well as minimal uh false reject rates and and using this approach now we have one

industry awards so looking at the bank negara's ekyc guideline that has been released uh we we look at the core focus of what the policy area points to the the use of technology to improve productivity like in online customer acquisition verifying the identities of individuals uh through use of biometrics technology uh and this specifically mentions that this is uh compared against a government issued id

uh which is the mycard maitantera in malaysia and and the others uh and the vendors needs to demonstrate ability to detect fraud right on the id document itself to verify if this is authentic and finally there's also emphasis on the ability to detect the liveness of the individual that is participating in this ekyc on the other end of the uh the device whether is it a mobile phone or

or a a laptop application so uh if ekyc may be a concept that is still relatively new in the financial industry in the banking industry and uh there are always going to be challenges understanding how to fit this into the digital product line into the onboarding process itself um due to a large extent you know the application application on mobile on web that is what the financial organizations owns

it is now the part where the identity verification work needs to be performed on a remote basis so this is where uh a vendors like like julia ourselves comes into your process takes over the the work to do identity verification produces the result and return you this output so that you have fulfilled you know a due diligence in terms of verifying the person that was signing up the service with you

on the other end so when we do that work or any vendor that does this work they must go through of course a certain number of checks uh on the biometric side of it um there is a need to match that the person who provided this id document is actually the owner of the id and and this is how this is where we use facial biometrics to compare the face of a selfie capture to the photo and the id that this is correspondingly the same person

but when you accept the selfie we need to ensure that uh it was a a good selfie picture captured it wasn't a a video or photo from someone else's facebook profile and then there are technologies to ensure that the liveness detection as required by bank nagara was tested that this individual was truly present behind the device right now um and then there comes this portions about due diligence and checks on the identity

document itself where uh there is a checklist to be performed uh what we're looking for in terms of uh is this is was this a digital copy was the real id actually present uh does it look like it's been manipulated did all the security features of the id card uh uh was correctly present so providing a whole list checklist and to be completed for every id card that's being verified will give you the kind of coverage that

yes no due diligence was done this idea is good and then we can onboard the individual now the there is always a trade-off when you go to business where when you have very stringent checks to be performed uh that takes time but yet in the digital economy in the digital space you need to perform this in a relatively short time so when the trade-off would be really how you actually reach a nirvana position where you can have a

very fast response time but yet complete all the checks that the regulators require of us so that that is where the unique proposition of delivering against the business because ultimately you are measuring your business success of leveraging on a digital channel to expand your businesses examples of clients like cimb bank in the philippines having achieved account opening on their digital channel of half a million customers in six

months or union bank when they first launched the application and they already declared that they were signing up more users on a digital channel than the entire branch network of union bank combined so i think these are the kind of measurable results that uh clients and companies in the digital space really want to have this big bank success when they actually launch a digital strategy so over the course of this one and a half hour we will be

very happy to talk about the questions that you may have around ekyc and i'll be more than happy to address them thank you thank you fredrik can we have cliff next hi everyone let me just share my screen with me a second

okay um you should be able to see my screen um okay hi everyone uh thanks so much i'm jenna for the introduction earlier i'm really happy to be here to be sharing a bit more about digital banking and uh ekyc today so i think what frederick talked about a lot about was the you know on the online interface um you know from ekyc verification and i think that robin also shared a bit more on the technology side so i think where where dow jones really come in is uh we are we are kind of um a data provider uh primarily um so i

would like to you know always give this example where you know all these um various tools uh it's like the car and dow jones is basically the fuel uh behind the car so so to have such an you know have all this amazing technology like napier and jumu um it really has uh you know data to be really an important component as well so i think what i'll do today is um just to share a little bit more about myself as well as um what dow jones do but more importantly also about the trends in the digital banking world right so i'm the reason compliance especially for

southeast asia so i look after the entire southeast asia region um and together with my team so i'm based out of singapore um and and we work very closely many of the banks you know insurers corporations across um the southeast asia region to provide our data for screening um as well as news um so what i'll do is just i'm just gonna share some um statistics with you today uh so i think just two slides um of statistics here right to show that you know this is uh you know an independent study done by dc um financial insights we showed that you know in two years time right which

is very very soon two zero two two um you know seven five percent of the apec banks would deploy you know intelligent uh automation and i think this is this is just evident to show that we are uh moving towards a you know an automated a very digital platform and i think kovic 19 as we are all um in this situation right now why we are all our backgrounds are kind of like from home today um is really because it's helping us to push towards that price so i think the investment being done to move towards a digital platform is going to be very very high um as the statistics have shown right as

well as the money being poured in um so i think again by two zero two three um 3.4 billion will be invested into digital channels um online and mobile platform so many of the or they have poor money into digitalizations um you know api uh networks and you know just giving clients more of a seamless experience uh i think that's the trend that we see here right um and of course where where does all this um comes into place with digital banking so this is

this is just a simple slide um to show the number of digital banks that have popped up um all over asia pacific um so of course you know you can see from here singapore and malaysia we do not have just um the applicants will soon be announced as well so we do see that two coming up um in the end of you know year 2020 or maybe early 2021 but but many of our counterparts in other countries right like korea japan um taiwan philippines they have all

started um with a digital bank um there and done quite successfully as well so i think why the purpose of showing this really this slide is just to explain to you right the number of digital banks that we have in the world and actually just in apec alone um we have the largest number of digital banks in our region in comparison to the other two uh uh main reasons in europe or in north america and i think the push is really because uh in asia or even in southeast asia right there are many you know customers who are you know

unbanked today um there are many people who don't have access to a basic financial or you know bank account so there's a lot of promise there's a lot of growth here in southeast asia or large teacher and apac which is why the number of digit banks is you know fast growing here and i think the regulators here as well they are active in you know open apis you know in singapore we have the htqr code uh being there and and fredrik spoke a lot of biometric identity tools as well so i think this these are all trends um to show and i think the the mobile penetration is one of the

largest things um it's worth mentioning because the the mobile phone penetration here uh in asia pacific or especially in southeast asia is you know is off the charts here uh the growth is always in double digits um and and the internet penetration is just going up uh you know year on year right so i think this this all this signifies to one thing right and and where um the digital payments uh you know and artificial banks uh opportunities comes into place so so i think this is the the context that we have right but

where does dow jones come into all of this uh you know it's just in this i just summing up in the last slide that i have here um so what what dow jones essentially does is to provide um the database right so not just to give you a bunch of um uh you know data just like that but but basically curate uh and provide um you know customers with the various data categories as you can see uh from your screen here um so from from you know global sanctions and official list um all the way to you know adverse media entities right so things

like global section official list would be you know all your you know the bank negara list uh your messages your old fac un and all this trucks so you know it is by the regulator's requirement to be able to screen against all this uh to ensure that when you do your own boarding you do your ekyc or your kyc um you will know basically that the customer you're on boarding is is not on any of this list um you also have you know things like quality exposed persons uh you know people who are linked with the government or you know works at a

state owner enterprise um so all this would be deemed as a politically exposed person so so so all this right essentially can be broken down to do things so structured data versus unstructured data so what you see on my screen here is all structured data uh where where daltons have curated a bunch of names uh we know and maintained in our databases and then we go into the unstructured world uh where is the world news so they may not be on any of these um data sets just yet however you know you have the star or

you have the new straight stamps press in malaysia reporting on that right so i think all this data part is is is what many of the tech providers are using to you know you know provide uh many of the customers to to give them you know initial warnings uh on the customers that they might be uh onboarding or they might be monitoring um so yeah i think this is just a simple um presentation i have to share a bit more on the digital banking landscape um where does dow jones fit into the digital banking landscape and how we

help many of the banks that i've shown in my third slide earlier with with their aml kyc purposes and later in the panel i'll share a bit more as well so i think it's over to robin yup thanks cliff and robin over to you

thank you jenna and thank you um jenna and the port ninja team for having me um thank you everyone for attending it really is an honor and a privilege to be here my name is robin lee and i'm the vp of aipac for napier and i'm going to be presenting on the future of transaction monitoring okay so in terms of what i'll cover i'll give you a brief introduction just level set everyone here and and take it back to basics we'll then talk about emerging technologies and then we'll go on to what the future of transaction monitoring specifically looks like

okay so setting the scene uh just a little bit about us um napier is um people first first off wonder how we got the name was from a guy named john napier who's a 1500 scottish mathematician now this guy was famous for two things number one he created the logarithm and number two he didn't invent the decimal point but we certainly wouldn't be using it like the way we do today if it weren't for the work that this gentleman did the company's just under six years old we're headquartered out of the uk but of a presence in europe and asia

we're actually profitable as well so i would actually consider us more of a scale up than a startup um just over 70 employees and we now have about 200 customers globally okay so a little bit about myself ladies and gentlemen i was born in this country here uh i spent 10 years in this country here um been in singapore now for about 10 years but i know there's many of people in this from this country here and that's where my parents from so the usual thing i get is um robin you you look like gently but sound like harry

potter so if you're wondering why that's that's that's given there okay so i started my career in silicon valley so i was a original programmer silicon valley nerd here so there for six years then transitioned to wall street where i was an analyst in the hedge fund space covering technology specifically um then got into the compliance space launched a startup that was subsequently acquired by one of the law firms in singapore then helped launch the red tech space here in singapore with a company called data rama

and then it was then i was approached by refinitive to run the southeast asia business for our risk offerings i've also been involved with a digital identity company named trace2 as well okay so in terms of what i do today i'm an author of two books including along with jenna we both contributed to the reg tech book i also teach a course called technology psychology which is how to think like a tech company and not like a finn company so i teach that at nus um the mit campus

out in kl and the castile group out in malta i'm also involved in an insure tech company i have a consulting firm i'm also the global fintech liaison for the us department of justice so there are um which is basically for their public private partnership in the fintech space so there are any fintech compliance officers who are interested in being involved in that please do reach out to me and last but not least i'm the vp of aipac for napier okay so what is transaction monitoring like i said i'm going to take this back

to basics and if you have a look here i found this definition from techopedia just focus on the stuff that's highlighted in bold here so reviewing analyzing and administrating the transactions process on a business application system it management and security process but and it's the um other name it goes by is business transaction monitoring okay a little bit of background here on transaction monitoring it really came into prominence post 911 it actually started out with humans manually looking it over but of course

transactions is probably arguably the biggest data set in any financial institution so that moved to excel and then got to the point where we actually need software to to manage these it's um it started out as backward facing so looking at transactions that have happened in the past um rules based so for an example of that is if i send a transaction that's over ten thousand dollars that's got to get flagged by the system um expanding scope and requirements so more and more is being demanded from these systems and as often case

in the beginning anyway no ui ux focus okay um typical challenges as a result of all this are false positives these are um alerts that get generated that are related to a transaction when they shouldn't have been um generated so it was seen as a risk but it's not really a risk okay false negatives the best example i can think of this is terrorist financing so if fred is a bomb maker and he wants to send 500 to cliff getting that 500 and cliff is

the bomb mate sorry if fred is the bomb maker and cliff is the terrorist sorry and cliff wants to send 500 bucks over to fred getting that into the financial system and then onto cliff um isn't very difficult um and and so those those transactions that don't get picked up by your system are what's known as false negatives extensibility so a lot of these systems were written in the 90s 80s and 90s so they're not flexible at all an example of that is that rule change that i mentioned so if you change that from ten thousand dollars to fifteen thousand dollars

often case you gotta go back to the vendor okay they gotta sit there and make that change for you it's gotta be hard-coded in some places you need someone actually sitting there coding that that change in for you and can get very expensive so the the standard rate for the traditional systems is around ten thousand dollars per change on top of that you don't know whether that change is going to be is going to produce more false positives and if it does you've got to go back to the vendor again and pay another 10 000 to make that change so not extensible um

flexible at all often case multiple solutions are involved as well so the risk-based score card system doesn't talk to the system that's doing your client activity review which doesn't talk to your transaction monitoring system so you've got to get systems integrators in to make everything talk to each other and integrate which is tough alone but the data itself on top of that is even tougher um as a result it gets very expensive um so one of the banks for their apac division has a budget of five million dollars a year with that

vendor just for rule changes alone okay um and then um this is the important part to us here at napier is that you're not there through the whole customer journey so how do you expect to expect to understand the customer if you're not with them through the whole life cycle okay so emerging technologies that that you know have potentially changed the game in transaction monitoring so i've listed them here cloud apis big data analytics ai this whole concept of ui ux the focus

and the tools okay um so what i've done is i've taken each of these um pulled up the definition per wikipedia here but um i've actually listed some advantages from a transaction monitoring perspective so cloud makes it scalable you get real-time updates it's cost-effective apis fast access to external data um in real time big data analytics you can reduce false positives deeper transaction analysis with a.i you can identify false negatives

and as a result require and also require less analysts and i'll put this ui ux focus here you know it's all about improving the customer experience and having access to more inputs okay so putting it all together the future of transaction monitoring so ideally um you'd want some sort of embedded sandbox where you can test out all those rules within the ui and we have that at napier we also have artificial intelligence now when it comes to transaction monitoring

and artificial intelligence there are usually schools two schools of thought okay the first school is where they'll stick an algorithm next to the analyst learn how the analyst works and the long-term goal is to replace that analyst the second school is where you put the algorithm next to the customer and you learn the customer customer behavior so anything out of the ordinary can then get flagged and passed up to the analyst at napier we're the only vendor that does both that i've seen in the market anyway but

not only do we do both but we have an additional layer on top of that called activity-based learning which leverages both these methods and filters out even more false positives and identifies even more false negatives okay the system is configurable as i mentioned um it's literally drag and drop we've made it that user friendly in our system to change rules and then test out that sandbox accordingly we developed a platform so everything everything on that platform all these different modules talk to each other and the platform is

not only a software-based platform it's a data based platform as well okay everything is self-managed with us like i said we empower compliance so we we we we leave the user we build everything into the user interface and experience for the customer and then last but not least we are there through the whole customer journey because we have this this platform approach okay and just to give you an idea of what's on that platform these are the different modules that we um actually offer here so client activity review transaction screening

transaction monitoring uh risk-based score card client screening so this this one here is real-time so payment screening is included in that and this ai module here like i said it's a it's a data platform as well as a software platform so that extends through to all of these modules here okay this last one here is as gives you an idea of of how different we are compared to everyone else so we don't charge you up front for a perpetual license it's software as a service

so as a result of that you get unlimited upgrades unlimited users um we also um are deployable on cloud or on-premise so some we understand that some regulators aren't as cloud friendly so we allow you to install our software on that platform it's that flexible and we don't require you to go out and buy any additional database or server os licenses here either so you don't have to spend an extra 100 grand for example on a microsoft sql server and most importantly to us uh we have this approach of customer

success so um our our chief revenue officer uh used to work is a silicon valley guy as well he used to work in consulting and he was part of the teams that put together the customer success programs for salesforce google and microsoft okay and that's pretty much it from it for me thank you very much everyone for having me awesome thank you robin so now we're going to kick start the panel so how it works is um i'm going to ask the questions as a moderator my name is jenna from font

ninja and we're going to get some introductions from our panelists as well so we're going to start off with uh frederick frederick could you give a short introduction about yourself about 30 seconds or so hi everyone so i'm frederick um as introduced i look after the business at jumeo for asia pacific region uh we have a team of supporting crew uh covering all functions and then and really we are uh provide providing uh uh

what we have built in terms of expertise best practices and really just guidance in the companies who are looking to embrace the digital channel as an expansion of your business uh so so i'm hoping that maybe through this session if there's any specific questions i'll be more than happy to answer them thanks frederick could we have an introduction by cliff yeah hi so um thanks jenna so yeah i'm the recent compliance

especially should i work out of the southeast asia region like i mentioned earlier so i especially help many of the companies with any dxr related queries they need our support for both structured and structured data thank you thanks cliff and i think robin has introduced himself but let's get shaming to introduce herself hi everyone good evening so thank you jenna and the rest of the panelists for having me here today uh so i actually work in maybang um i actually hate the strategic digital

alliances team which actually falls under group strategy and basically international office uh i didn't do an introduction today because i believe that you know i think many of you would know who maybang is so i'm not going to go in that into it yeah thanks xiumin and let's get the ball rolling so um for let's let's start with frederick right uh why is ekyc in demand in comparison with kyc right the difference is there's one is e in front and one there

is a traditional kyc and why is it welcomed by the regulators would you also highlight some of the aspects that um in the recently finalized framework ekyc by bank negara malaysia our central bank sure and jaina so it's a very long topic but i'll try to condense it into three minutes i think that the the attraction of the digital economy is really pushing regulators to look at

the kind of conditions that you want to create in your your domestic economies or countries that will support the the financial industry to uh to expand businesses to compete uh regionally globally like uh in in a way that will be what we're familiar with the creation of the facebooks and the the amazons the early pace uh you know so that the regulatory framework is very important it creates the condition and and where new ideas uh you know can

emerge and that we can leverage on this uh in the next level of uh business in the digital space right and and some things are also quite quite basic in terms of the ability to reduce business costs because when you move away from a physical location a branch right we kind of put a control on those kind of costs as business business expands and uh getting productivity up to speed where where now you can leverage a digital channel to sign customers you you may be thinking that in

traditional space and like one of the examples of our clients you you were on boarding maybe like a hundred clients at a branch across your country in any single day but once you switch open to a digital channel right that number could increase a hundredfold right i think that that's where all the excitement is about getting the digital ekyc right because it could represent a huge expansion and unfortunately because of the covet situations affecting us globally this non-face-to-face thing is even more critical than ever before

so in some cases or in many cases if you don't have a digital strategy your business has stopped since march right and and that's really putting a lot of pressure in terms of getting companies to to really look at how they can continue with this business so uh a bit about where i thought that the bank negara's ekyc document was really interesting and and maybe points to look at uh one very important area is about this accountability uh topic that the the board of directors at the

bank or the financial institutions will ultimately be responsible but to be responsible you must understand what did you buy and implement there must be very clear transparency how the system works how do you approve an individual how do you reject because ultimately it cannot just be a ai driven uh process nowhere there is no human control and there's no overview so i think that where uh any of the companies today that are evaluating kyc products

you must be fully comfortable with how it works this transparency of the system what checklists are you getting how these whole kyc facial matching algorithm works and you you must be happy with it and ultimately i think that from other countries in the uk in hong kong uh where we have seen an earlier generation of virtual bank projects being run there will be a lot of requests in terms of exception handling

right and in those cases when they appear there will be so much data that you need to generate on the fly in terms of reports right to study at every stage and every month know what is happening in your kyc system because you will want to look at it your auditors will not look at it the regulators will look at it so when you're evaluating kyc vendors the ability to provide 100 audit cover right and ability to generate all these kyc audits in real time is really really

critical right i would say that um also in the area of um go to the approaches where you develop your ekyc strategy manpower skills competency are really important unfortunately ekyc is still quite a new topic when we bring it into our client environments there will still be some learning curve in terms of how you connect this into your products how do you actually bring this into your

whole onboarding strategy right and then at the back end if you are building your own internal teams to manage the algorithms to create the the rules and tuning because getting the technology right is one part the other part is does your end user like it because when you launch and people don't sign up correctly and they fail then you're losing missed businesses so that is also a big part that you you're gonna take care of i i think ultimately where the bank negara's document uh in the

appendix that they specify a reporting structure of your far and fr if you take notice they really separate out uh the top hand sections where you have got to declare your data right for your i document checks that you have done due diligence that this id that you saw uh was uh in good order and that this is not manipulated and then on the bottom half they have got biometrics statistics asking you to present your data in terms

of phase match capabilities i i think that this these two parts shows the the level of uh in in-depthness that you want to look at the the checks and i think that um when when this goes live right there there will be a lot of monitoring required uh in terms of the early data coming in because when you can build six months 12 months of data to show that the system can be trusted this is where we see that the processors

becomes a bit more stable right so so my my take in on this bank negara's ekyc policy guideline really will be that there's going to be a lot of work to be done in the early 6 to 12 months it is never technology alone there's a lot of expertise or did processes real-time reporting is going to get it right thanks very i think that's quite a good start and i think because frederick you mentioned a lot about checking with the data

right and that goes to cliff coming from a data company so what are your thoughts um um regulatory reporting versus the need for practical innovation what are your thoughts cliff yeah thanks jenna so i think you know for regulatory reporting is a really important thing i mean it helps protect you know organizations and and more importantly the society uh from the impact of financial crime i think that's something that uh the right places are doing a great job in so you know we've seen

you know tough fines being dished out licenses you know being taken away many of the countries that we operated out of and i think that's just a testament to show you know how tough the regulators will come down uh you know in protection of the society of financial crime so i think that there's one thing is very important but as we go through like what you mentioned about practical innovation we you know the regulars also probably understand uh and i don't speak for that obviously but this is just my own opinion that you know they want the companies or you know the financial ecosystem to continue

to grow um not to hamper them right but you know but to grow you know at the at a stage whereby you know you know financial crime would not would not be you know too too invasive so i think the need for practical innovation probably will come in the form of um you know regulatory technology um so i think you know frederick spoke a lot about um the reg tag earlier in terms of you know it's not just automation but you will need you know things like expertise uh you will need a lot of real-time reporting so i think all that will come into play right but direct

tech will probably be um the best way to to to help you know with regulatory reporting and to help grow um the the businesses still right because reg tech is basically an automated process to help you facilitate you know compliance versus um regulation so as you automate your due diligence process and you use um you know large amount of data um you know what what you will want to do is to have basically ai or machine learning to help you um to have you to judge whether this particular person is you know a

sanctuary individual or you know this person is on any first media news and stuff like that um but i think complex you know areas of decision making is not you know just dependent on human operators anymore in like in the past um but it is being supported um by technology based uh machines but i don't think it will be completely replaced i think the the key word here is supported by technology based uh minimum machines i think the best way right for compliance today or for regulatory reporting is to automate however as you continue to automate

i think the professional human judgment that many of the you know the brilliant compliance officers or here are complex offices that have the pleasure uh to meet in my career you know their expertise will still prevail right because sometimes you know the the criminals are always ahead of the curve you you basically will find something else to to circumvent you know the the way is being done and then basically things will we will kind of play catch up along the way so i think you know human judgment is still important um but so i think a mixture of automation and human judgment will probably be the

best way for practical innovation yeah thanks cliff and i guess you kind of ease into uh robin's part you know robin what's your perspective what is the relationship between ekyc what frederick mentioned and what cliff mentioned with data and aml and what's the importance in that in finance and banking and the fintech world i mean ultimately the two go hand in hand right i mean if we go back to again go back to first principles here what is kyc in general it's making sure

that the individual or the company is who they say they are right and then what's aml it's it's it's anti-money laundering i.e preventing dirty money from getting into the financial system okay so the two absolutely go hand in hand um and and so i think it's really important that you you you are there through the whole journey to experience all of this because through the customer journey because you know that way you'll be able to tell whether whether

you know money launderer terrorists or or or um shenanigans are going on with their account from a fraud perspective as well so yes they are important and i think your follow-up question was um best practices right related to to aml um so this is where i would i would absolutely recommend that you have that platform approach something that that that is end to end and the data it's a data platform as well as a um a software platform

um to add to cliff's point as well i absolutely agree with him that it you know we're not going to be getting rid of compliance offices or aml offices all together right it's the analogy i use is it's robocop not terminator right whereby robocop is part man part machine or cop and terminator is 100 machine right you do need that that human human element because ultimately who you up against the bad guys and the bad guys are human and the human mind is is something that we that that you know no computer is going to be able to take

out anytime soon does that sound is that okay yeah sorry i think um um i think let's ease on to xiumin so with the push of innovation right and with you know things like ekyc the data company and um napier ai aml which is a ragtag company so what are your thoughts on innovation has the bank started innovating in your perspective

well okay i think that's a really really good question um i can't speak for all the banks that's out there but i think generally if you look at the last five years or so um a lot of banks in malaysia has actually started like a lot of their digitization project or actually moving into digital transformation uh but having said that there's a lot of definition or different definition or different standards when it comes to innovation and also uh digitization

if you ask me so for some people you know um basically uploading a form into like a digital format that is considered as digitization but for some other perspective is basically correcting the right data and actually using well you know uh maybe things like ai or machine learning and that is also considered a form of digitization uh from well you know from from different perspective right so the thing is if you ask me

um yes of course there has actually been a lot of like different types of innovation uh that's been happening in the banking space uh there's also a lot of um you know companies that that's well let's not even talk about fintechs but tech fins that's actually recently sort of like changes the whole different landscape especially when it comes to banking so we're talking about uh the giants uh the giant tech fins from from china especially like and financial like tencent uh so so wechat basically

you know they have actually really sort of like revolutionized how i mean how we look into banking today which is really serving the nsf uh and of course malaysia uh i mean if you look at it from the past well three to four years as well you also notice that that's actually been like a boom or what we call like um the battle of the e-wallets right which is more or less sort of actually hinges on the use of you know uh the technologies and also ekyc as

well so you asked me if we have actually been innovating uh the question definitely is yes um but what i want to add on is that because banks are such heavily regulated by by bank negara or by central banks we always need to sort of come up with a balance when it comes to you know innovation versus you know whether the user's data is going to be compromised or not so uh as i mentioned there's a lot of

like different standards when it comes to well even like you know validation of like certain datas or whatever uh that's out there in the market today so you know i noticed that a lot of question has actually been directed to frederick you know what the standards you know are you linked to like whatever uh organization whatever you know that's what the thing is is like you know there's a lot of different checkpoints and i don't in my opinion i don't think anyone's perfect at this juncture because e kyc is really just the beginning right um yeah so i guess

you know we are still in the space that we are actually learning as we go but of course you know there's a lot of regulation and there's a lot of things that need to put to be put in place to ensure that one day will actually achieve like a hundred percent uh well basically you know a positive results so so yeah that's that's thanks thank you maine uh i'm gonna pick one question which i think is going to be useful for our base uh so this is for robin what is difference between fintech and techfin right i mean

a tech fin is essentially tech companies particularly big tech companies coming into the banking space and and and you know offering financial services so um as as charmaine mentioned you know 10 cents come in um alibaba but even like guys like apple and amazon right are starting to to start looking to offering financial services if not already so that's essentially what a tech fin is hidden texts are traditionally perceived as startups or scale-ups and

then traditional fis are like banks insurance companies guys like that thanks robin um let's go to with cliff cliff um right now with the push of neo bank a digital bank in asia pacific and and i understand that dow jones have worked with some of them uh in the region what what are your insights working with some of them and and how do they manage the compliance and aml practice with data yeah thanks um jenna so i think um yes in dow jones we

we had an opportunity to you know work with many of them and earlier my slides you know many of the banks in um you know the picture earlier that i've shown they are um you know partnering with us for data so um we are very lucky to be in a position to see you know um you know from a digital um front in countries like you know uh like what um xiaomi mentioned earlier in northeast asia where you know we see a lot more uh middle future banks coming out in places korea taiwan and hong kong but i think what all these banks have in common right whether it's

a cacao bank in korea or line bank in taiwan or liby bank in hong kong is that they all adopt an automated process in customer boarding so i think that's something that we see as a common denominator here um so in this scenario right many of these digital tanks they will basically either have an in-house developed technology platform um where they develop on their own using their own engineers or they will engage a third party technology provider to help them with their onboarding and aml screening so like robbie mentioned it comes in hand in hand uh when it comes to you

know ekyc and aml right but but i think where the where dow jones would then come in right is basically as a data partner so so what we do is that ultimately downloading platform per se but what we do is to provide the data that favors the technology platform right so i think i started earlier in my present by saying that data comes in two main forms right one is unstructured data the other one is structured data so now so structured data has always been the easier one to work with because it's basically a

set of data that is structured and you have you know a bad guy from one number one to backhand number 100 you're not on an old fact is that is very straightforward when you run say cliff lim and i'm you know bad guy number 62 on the offec list my name comes up that is very very straightforward um and and and you know you have you know political exposed persons then you know all that you know special interest person all that stuff is is straightforward once you you kind of post it up you know in your database you often curate um what is difficult and

the challenge behind structured data is to you know update curated um when there is a new thing so like recently in singapore we had our elections uh two three weeks ago um you know so so what what a data provider would then do is to basically update you know the whole line of new politicians that was selected uh so that that comes in life as we speak right um and sanctions data is updated you know it has to be updated very very often uh to ensure you know there's no point having outdated data just like news but i think what what we are you know

venturing into is also you know you know one part of the world is the unstructured data and that's the part that's harder to you know come into correction because structured data is easy you screen against the structure data set like i mentioned unstructured data is things like news um so you have you know so many news providers out of singapore in malaysia you probably have you know tens of thousands of news um you know around the world you have fake news um as well um you know so social media has played a big part of it as well so i think in general what what how to what extent do you want to screen um you know in your kyc is really up to

you know each different banks or a financial institution or new banks uh risk-based approach um so some of them will say okay you know what for sure the structured data something we need but we're also keen on unstructured data we want to know you know why uh this particular individual um you know was reported in an alleged case targets ago um you know um and then it was reported on the south china morning so they want they want something like that and that's where you know we do provide this unstructured data but that's where the analyst and the technology provider will kind of combine the two together um to

have ultimately a very very strong defense mechanism where you don't just fit against structured data but you also screen against unstructured data so i think in general that's what we've been working with many of the new banks thanks cliff and frederick so i think we're going to combine this these two questions right what are the best practices for ekyc but then on the other hand you have best practices what the challenges that you see uh you know in in kyc in apac uh

i'll just probably select a few that are probably a bit more saline i think that when when we deploy ekyc uh you got to get everyone on board you know the business it uh the whole project teams uh because designing this customer experience that that will be your front door to your clients in the digital world how how they uh experience this you know what can they choose things easily did they finish certain steps quickly i

think that it all counts ultimately into that space where there's so many financial apps and that if there's any slight inconvenience unfortunately the users will hold it against you right now there but in this ekyc experience that we see you know um there's also a big part where it's related to uh use user challenges you know where it is operations if someone uh looks at this app and then he says oh

i need to take a picture of my face my id and he gives you a picture that is slightly blurry so are you going to reject him and ask him to do again what if he doesn't and will he come back and and there are also occasions where uh they are taking a picture of an id and their fingers are covering some critical data you know maybe my my surname is blocked because uh the way i helped my id was just cover are you going to reject this user is there a way that you can course correct in some kind of a feedback loop that

goes back to him and tells him what he's doing wrong i think that all these are design elements as what your kyc system can or cannot do because ultimately we we want to be those uh in the news where you know the brands that we have launched online has hit you know thousands if not hundreds of thousands of sign ups we want people to know that there is great market acceptance acceptance for our products and so this this whole part about the the user experience now becomes critical because there will be mistakes that end

users that we make we don't automatically understand what kyc is we just want to know that uh we won't know that we want to open an account and the whole process must be simple and and other parts of the challenges are over really keeping in times with uh online identity fraud but what's going to come how is it going to hit you and i'll just name some some very recent examples where there's this whole scenario of a same face multiple identities

so face matching is really matching an id photo to a biometrics your selfie right if you cannot detect that this id has been manipulated you are just matching the fraudster to his own selfie and there were many accounts that were created in the same way where these were considered to be meal accounts that was rented off to some nigerian fraudsters they would use these accounts for money laundering for visa fraud you know for for other kind of other schemes

so so that it'd be beyond just face matching as well as uh you know uh biometrics you you have got to layer what your system can handle to catch up with the most recent fraud trends in identity online identities so uh deep fake videos right as a way to spoof liveness that's also a big problem right so i think that having your vendor being on par up to speed with with different fraud uh behaviors and practices is is gonna

be very important and how your own project team can report back to the regulators that these new trends are coming in how am i going to handle all these as part of protecting the the company the ecosystem against uh this scenarios so uh there are really so many things in challenges that can be spoken about uh but the expertise of the vendor you choose and how they share can help you design your compliance to the regulations is going to be critical in determining

how much work you're going to end up doing yourself like if you don't get the right partner with you thanks fredrik and i think on to robin um in terms of the regulators right some of them require some manual instead of just pure automation um i think it really depends on on who the regulator is obviously we we see some regulators

you know really stepping up their their whole digital transformation game right and for example in mas a where they're encouraging as much um digitization as possible um that being said i guess there's there's the um um the issue of of um you know depending 100 on on machines to to do your compliance for you you can't do that i mean so so that there needs to be some sort of human element to that because ultimately you know if

something goes wrong who's responsible it's not the compliance officer is senior management in the in the fi right they're the ones that that ultimately hold the bottle so so when it comes to when it comes to you know automation and and and what have you the regulators some many of the regulators are encouraging it but they're for example with with ai they want explainability right so this whole concept of a glass box versus a black box so you can

you know i guess you can automate as long as you do it in a way that is explainable and makes sense um so i i i don't i don't entirely agree with the the the fact that regulators want manual work and and and and the openly promoting manual work because you know you've got some pretty cool guys out there right and what do you see uh the challenges that aml may face in in asia pacific right now the aml mayface um

look from from from a transaction monitoring perspective i i would i would put it down to to two things number one the criminals are are smart right so so getting getting around that human mind like i mentioned before is really really difficult but secondly uh it's really down to your your internal policy as well so i cite that example that i said earlier where every transaction over ten thousand dollars has to get flagged then your your false positives are gonna go

through the roof right and you're gonna you have to you know triple your compliance team easily just to deal with that so you need to you need to have a a policy that that makes sense as well so i'd say the onus is on on on multiple fronts all right so i think um when you say multiple fronts i think any any thoughts from sherman frederick cliff on aml issues in apac yeah well i guess you know coming from a

bank perspective we are always diligent when it comes to well uh aml uh practices right um but having said that you know it will never be a full-on manual process uh there's all different technologies that we actually use to actually monitor uh what's happening uh uh in terms of like user behavior and also in terms of like if suddenly you've done basically like an in search of like a large amount coming into the bank or whatever so as i mentioned right it's

always like a balance uh between technology and also like there's also humans actually working behind to look into like the graph and patterns as well because yes the machine may be able to alert you in terms of like what's happening by the end of the day uh a person judgment is actually required to see whether okay is this valid is this not is this a repeat uh transaction or is this something fishy uh and also you know uh then it will be additional uh

due diligence that's actually go into like looking to the different companies that maybe that is sort of like are transferring the funds or where the sources of funds are actually coming from yeah thanks jermaine and i think um going to the next question right because i think everyone's looking forward for new band digital bank in in asia pacific right now what are the challenges that you think that that uh that is related to this uh business model of nearby and digital bank in in malaysia and asia pacific um

anyone yeah um so so i think just looking at southeast asia right i think first of all um you know there's some statistics that i that i read some time back um that you know the number of unbanked uh percentage in singapore's about two percent malaysia i think it was 15 um thailand was 18 indonesia 51 um philippine 65 and vietnam is 68 so as you can see the the challenges i think is different um for each country and for countries

like singapore malaysia and thailand where you know the unbanked percentage is relatively low i think that the challenges will be you know a bit more on the service area thinking one of the things like that the likes of your dps your ocbc your maybang or cimb they cannot they they're really not doing they are doing all this right they have spent a lot of money on digitalization they're doing very very well um so i think the question here is that why do you want to go to a digital bank so maybe it could be you know novelty it could be you know competitive race could be just something you know for the chansey or the millennials to

to like right to to be you know seen as cooler to bank with a digital bank so i think those are the elements at place but i think for countries like indonesia vietnam philippines where the percentage of the unbanked is a lot higher i think the challenge here is how do you attract um you know this this growing um you know i would say middle class that may not or low to middle class that may not have an access to a bank account so i think that's where if you can see a lot of the investments being poured into countries like indonesia or philippines uh because of the percentage numbers there so a lot of the uh you know private

equity funds they're all investing money into those countries because there's a very very attractive market right there so i think definitely between the three countries of each side um there are two different challenges right just in general just just in terms of the feasibility behind it but i think in general we can all agree that um as the you know as we continue in a number of years um the idea of a digital bank is definitely going to attract more people rather than you know turn people off from here

thanks cliff and i think frederick um what do you see the next stage for ekyc in in asia pacific and then for robin um where do you see the role of compliance change or evolve first okay yeah i would like to answer two questions no i there's there's a point i wanted to share just on the earlier question um you know i thought that just a quick quick sharing uh in the in the business model of the new banks i i i see that there

is is intensely competitive at the product level the interest rates uh that's offered you know to sign up and accounts like uh really uh in the first one two years of the launch of a new services financial services product is is really uh very very high whether that model is sustainable or a long run is it's a question that of course everyone asked but from a kyc perspective how how can this actually help in that sense if if a kyc engine

itself can have got different tiers where you you have a lower cost here that will be able to support less profitable uh scenarios maybe like deposit-taking right uh where certain basics kycs are being performed like uh you know at the level and and a higher level of kyc where more checks are being done for uh more profitable but higher risk kind of a transactions like maybe loans so maybe on any kind of

a launch of a of your product itself no out of 100 subscribe subscribers that are really there to open an account and and try to earn some more uh uh interest rates on their deposits 10 only will be uh people who actually want to take a loan from the bank right so you want to design your kyc at two different layers right where you pay less money for a general kyc right and then focus your checks on people who may run away with your money

right so i think that at some level of strategy and tiering this it will be a strategy that's a lot more palatable to the shareholders right in terms of where you're going strategy uh and then on the second questions about the the future of ukyc i think it's always useful and i think some of the audience did ask you know if there was a government asset a government system with a citizen data that we could we could connect with i i think that for most of the countries today uh

there this digital identity system is a work in progress but we we are going ahead with business today because we we are not going to miss the market opportunities we want to get and design our ekyc ready so that it can hook onto the government system when it's available so what what are you doing now in in terms of your onboarding creating the best set of data that you can believe you can trust right yes and then of course later on it can hand an interface with a national digital

identity system a lot of this in the missing link will be the liveness detection it's a big topic behind it right but i would just uh encourage the audience right to look at this as a big component of what you need to think through of your framework right ultimately this will make you sit very nicely right with a a national system that will really enhance this whole digital system of trust that we needed to create to support digital business

thanks frederick and robin robin yeah sure so we're talking about the future of the compliance function i mean um i definitely think that that this concept of public-private partnerships such as what we're doing at the doj is is is the way forward especially from a a data sharing perspective i think that um i also think that cyber security and and data protection will fall under compliance if it doesn't already in something in some organizations um

i believe that compliance officers will also become more data-driven so there was a panel that i was on about i don't know six years ago or something and um the um one of my my uh my fellow panelists predicted that in 10 years time um so that's 15 years and in 10 years time from now the head of compliance would have to have a phd in data science okay um and then and then um last but not least i i really think that the the mindset

of a compliance officer will evolve and and you know if you kind of look at like what that you take your different quote-unquote types of compliance officer right you have your your financial industry guys where where everything is is is very prescriptive right you know that if you send over ten thousand dollars that's gonna get flagged you know that you're a bank and you have to adhere to a certain capitalization ratio and you break that ratio that's gonna get flagged whereas if you look at compliance officers in like um like corporates for example

um you know like like apple take apple for an example you you had a head of compliance with apple it's got to make sure that there's there's no anti-bribery corruption internal fraud external fraud that they're um there's there's no like child labor going on in the in the factories that they're involved with so a lot of it is figuring out human behavior right using humans to figure out human behavior which which i think is is kind of like where where it would it would go for the financial guys but the next level on that is what the social media

compliance officers have to go through because they they have a completely different mindset because not only do they have to do all the formal stuff right because some of them are entering financial services but in addition to that they're gonna you know figure out stuff like can my platform be used to you know to predict election results or or or or you know encourage terrorist recruiting or and stuff like that right so they haven't even topped a and and the best example i can cite is i have a couple of friends who are

compliance officers in one of the silicon valley social media companies and they faced this challenge where people were were there online um using live streaming to commit suicide okay and then they found the most common way of online suicide was slicing across the neck so what did they do to to get around this they they pulled in some of the computer vision um developers um figured out that that the average like inch was like i know four inches away from the neck like 70

percent of the time something like that results in in suicide and so that they're figuring out that if that does happen then suddenly all my contacts will get notified saying hey call robin now we think he's about to top himself it's a rather extreme example but i i definitely think that again that that way of thinking is is what's what the compliance officer of tomorrow is going to have to adopt thanks robin and i think we're going to head to the last question with xiumin so what is the best thing about your role right now just to wrap things up

and then we will go to the q a um okay best thing about my role right now uh so i think as i mentioned earlier i do well strategic partnerships uh so day and day i day in and day out i see a lot of new technologies i work with a lot of different partners so uh and as i will emphasize tech fins and also fintechs so techfins which is you know the the financial giants is out there today and also fintechs which is the small startups uh

or even like you know different companies that may bring additional value to my bank customers so i get i guess it's good because i'm always in the know in terms of like what's happening in the market uh because there's a lot of like different presentation or proposals that actually come into our team and we're always exploring to do new things so i think that's the best part of my job yeah thank you man also i'll start picking up questions um i think this uh open to anyone does ai in aml

adds additional risk to financial firms and makes de-risking even more important so maybe robin you want to take this up sure um again i think this is where the regulators have done a great job in terms of stepping in and and and trying to encourage this concept of a glass box versus a black box um and that goes both ways right not just what the what the financial institution is doing but the vendors like us so for example you know one of our

competitors that i i've seen in the market has been out there in a public um conference saying that you know we don't we don't make our own ai we just take google tensorflow or something like that and just just train that up and use that which not only does it not give them any edge but you know google isn't going to give them the algorithm right i mean they might explain it to them but they're not going to be able to go in there and edit edit the the original algorithm and code to that down to that level and so you know the whole question of liability will then

um come in like who's to blame blah blah blah blah so so the regulator's like you know what just just make it explainable that that's all that's that's important to us and and and um you know have a glass a glass box versus a black box thanks robin and i think this is for um so this is open for anyone um does it screen also for companies or only if the customer is a natural person or the natural person rep so i think this is for definitely for cliff

yeah so if if this is um you know in talking when assuming the question was um screening against databases then uh the answer is uh yes it screens for both companies and for individuals so usually our data will split it up into two forms so one is uh individuals where we you know we cover sanctioned individuals but they're also sanctioned companies uh they're also sanctioned related companies so companies who are owned uh by by sanctioning companies indirectly or directly so we cover both

thanks cliff and i think this is a follow-up so how reliable are database sources yeah so so for database sources right um you know again uh for for the structured data and unstructured data to use that so the structured data is quite straightforward we get the sources straight from the you know the olfact the mes the bmm anything is publicly available that is given uh to that so for example there was a earlier question on the ministry of home affairs uh

sanctions list in malaysia uh so that is something that dow jones we recover as one of the lists there um you know and on top there of course there are a bunch of other lists right so so we have about 1100 different lists that we maintain and curing on a daily basis so that is um that is for um the structured site right but in terms of the reliability of the other part is the unstructured data and i think that's more of a challenge because news can come in in many forms so what we have done here is that uh we have a platform called factiva so factiva is a news aggregator

uh and in factiva what factiva primarily does is that we work with content licensing of different publications and what these publications would then do is that we will check right so for example new straight sums press or the straight stamps or the studies are all verified media uh we're not going to add and say the clevelandblogspot.com and whatever i say it doesn't really you know play a part in that so so this is one part of how we try to you know kind of combat the fake news to ensure that the reliability of the data sources is kept

at a good level and high high level for the unstructured data thanks chris and i think um i think we have a couple more questions so i think i'll start off with it's ben negara's ekyc guideline aligned with bruce non-face-to-face verification rules for their appeals uh maybe frederick are you keen to take this up uh yeah i apologize i may not be totally

familiar with house i haven't gone through that area so i may have got to uh abstain from this yeah okay and next one is has jumeir gone through ben negara sandbox to qualify as an ekyc vendor i think this is directly related to bank negara malaysia frederick yeah i think with the release of the ekyc document itself it specifies how banks how any of the financial institutions can apply uh to use technologies like uh

prior to that julia do have a couple of fintechs that have been uh passed right and unlicensed to operate in malaysia uh for money remittance services which is the lower level qualifications but uh with with this guideline official today riker is really about file and use right as well as applying note for uh your technology set that you need for your business right under the compliance framework for bank negara yes i think just to add on for everyone uh sandbox is normally

for two situations one is when there's no framework at all there is no clear guidelines then you go to sandbox and where there's clear guidelines you don't really need to go sandbox and i'm not sure uh whether anyone is familiar with this there is no like a registered vendor under bank negara so normally those who are licensed and those who are fis they are the ones who are responsible to pick the vendors that they need that that fits into the criteria or requirement that is um by the

regulators so i think this is for sherman does maybe apply ekyc and use aml monitoring uh the short answer is yes uh there's no long answer unfortunately i mean i mean all the banks are actually going to this right so um yeah so yes we do thanks germain and i think we have a couple more questions a lot on the ekyc side so um a recent report by pwc that

studied and tested on liveness on ekyc software and outcome of the test has shown that ekyc software failed the liveness and landmark checks during onboarding printed ic damage ic managed to pass the identity proofing how how can we prevent this so i think yeah uh frederick this is yours yeah sure um so i i think there's always you should always have your uh

criteria and checklist against your ekyc vendor in terms of how how are they dealing with these specific areas that uh is maybe the benchmark of what pwc have set up so uh liveness is a difficult area and and uh that it has been demonstrated that uh when liveness is uh uh requires user behavior like a blinking of an eye a turning head uh you know turning your heads or you know moving moving your mouth

these were very easily uh animated using deep fake technologies so the whole series of ekyc vendors that depended on human faces to blank eyes they were easily spoofed so where the the standards today that we try to follow right uh uh have having that the liveness engine certified and there are uh organizations globally like nist

labs i beta uh iso standards like trio 701 like uh that specify what they call the penetration attack detection right where these really run through your engine to determine if a deep fake video when presented right will it be able to spoof because if it is easily spoofed it means that i can just go to your facebook profile take your photo and make it turn your heads and blink in the eye that the banking app requires

if that's all it takes to pass liveness then of course this is going to be a big risk right for the financial industry so industry certification like uh in terms of complying to uh uh best practice safe safe practices for lifeless detection is critical so with jumio we use a 3d phase map technology so as a 3d phase map we can discern between a video which whatever deep fake video is always just a video right it's no ability to demonstrate a

3d depth right a person is in front of a phone participating in in this now the other part about the uh ekyc checks is really quite critical to understand as well so in countries where their national system is great because you can verify you can validate data but in many countries when the digital systems are not ready yet then you only have got to depend on the id documents and the biometrics as the the easiest way to get users to onboard now

in this document itself there's a large amount of checks that you need to run right there are some things that can be machine run right there are some things that has got to be uh visually visually cued now you can't get away from this it's either you you have a process to cover this or you don't check so i think where pwc refers to is that when they have this checklist because the regulators say that they're these 20 points you must check them all and the engines will just probably miss half of them because there's no ability to check them so this will will come into situations

where uh the results are only 50 50 at best yeah so whereas in jumeo it is a hybrid model where there is an ai engine running the checks and there is also a hybrid team uh human team that actually doing the other checks that they can complete the whole process thanks very i think that's a that's a good uh overview um i have an interesting one do you guys currently track cryptocurrency addresses associated with illicit activity

for instance i guess this is a very recent one the crypto addresses associated with the recent twitter hack um maybe robin you can can weigh in on this sure i mean we we don't offer that at napier we do transaction monitoring but what you're asking about there is what there are what what you're asking over there is what's called blockchain monitoring and there are there are companies that that do a really good job with that especially um if you look out for like guys like merkel science who are based out of singapore

and and and specialize in um in asian data but there are so i would i would i would say give those guys a call and and um they'll be able to to provide a much better solution sorry a solution for that that use case thank you it's a good point that uh you mentioned the different solutions that's targeted for niche problems so i think that's that's a good uh answer and question so granted the disparity of approaches by different vendors and i think this ekyc framework

will definitely spark a lot of vendors coming to the market right different approaches by both the vendors and regulators would private public partnerships work better in enabling kyc utility framework for synchronized consistent kyc locally uh any thoughts um yeah i would just briefly attempt to give some opinions i think that um uh the the digital

identity systems are an example of where uh private public partnerships will will really have got the a role to play like uh when a an authority that can provide data that can be very very very dated against right that will be one level of checks the other end is that the organizations themselves ultimately is responsible for onboarding it is responsible for user experience because when we talk about this

ekyc as much as we talk about false acceptance rates we're also going to deal with things like false reject rates for for those customers who are genuine and they just for some reason they fail to to on board right because they should have the the private sector itself should really handle that as a user experience strategy building out what needs to best appeal to their own clients right now uh when these two come together i think that it's a very strong force

right really to on the one hand you know validate the data there's biometrics there's actually a document numbers there's names that can be validated and the private sector is still free right to choose the best technologies to their own needs right to handle the uh the onboarding experiences of that they can differentiate their own businesses thanks frederick um i think this is uh for cliff and robin um online games are a primary

means of laundering money internationally one of the major ways in the process is have plenty of micro transactions instead of big single transactions has neither ai have any experience in overcoming this in ml for online gaming casino pokers etc so maybe robin you can start first and then cliff you can let us know about the data part because this is part of checking as well sure so the the short answer is yes we do have have clients um in that space

um and what you're essentially talking about is a money laundering technique called smurfing right where you do tons of little transactions and they add up to to one big one so absolutely napier has the ability to to identify those now it could be done in a variety it could be done in two different ways right either you could set up a rule which again you don't have to go back to us and get us to program it for you you can literally um set it up in the in our ui ux uh to accommodate for that type or um you know uh the we can send the

the ai algorithm to to run through the customers transactions and and and pick out anything that like like that kind of a scenario um to identify those so either or but most people just choose the rule system right because um they they pro they either don't have enough data or we have this thing called crawl walk run right where it's like start off with the rules first drag and drop them customize them as much as possible and then you can always add the ai in later when you're ready uh cliff your thoughts yeah so i think i

think definitely uh for for gaming it's always been a sector and a hot beat for money laundering we we have worked with many uh i wouldn't i would say mostly online also online offline uh so mostly the the casinos who who are present in many countries uh they are primarily one of the customers that we work with but yes we do see a lot of shift towards online gaming and i think that that is an area that is very hard to um supervise and to look at but what they are most interested in is usually in two things one is that we

have a data called special interest persons and these are individuals who you know committed financial crime corruption bribery and all that stuff and and these are the most commonly uh screen names that they want to check against uh when they onboard a particular player um online um and as far as politically exposed persons you know some of the countries actually ban political exposed persons from gaming so these are the two main data sets that these you know online as well as offline gaming operators are looking out for

thanks cliff um i think this is for you sherman so i think because you also came previously from the corporate world um so this is like balancing between the corporate non-uh financial the question is is full corporate onboarding with ekyc permissible and regulated by ben nagara as well what's your standpoint this i think what they're saying is um like uh like in the corporate world right so if let's say we use because ekyc is already regulated

by negara um and and also i'm not sure whether er one knows as even law firms are supposed to actually um have have anti-money laundering knowledge when they onboard clients so so in the corporate world what do you think should they apply and practice this based on the standards that is marked in finance and banking what's your view on this um okay i i'm not sure if i'm actually gonna be able to to offer super in-depth uh knowledge

into this topic but however having said that um i mean obviously in my previous organization as well which is uh samsung what we do is that uh before we actually onboard any of our partners of course you know uh there's a lot of due diligence that that is actually required but if the question is maybe from a perspective whereby as a corporate organization whether e-kyc should be implemented or

not i don't think the technology is actually there yet or we are not really there yet to to actually look at it from a corporate standpoint because i mean as we are we're talking about well you know uh individual ekyc's right but i guess like from a company perspective there are also a lot of like different things or different checkpoints that needs to be explored so uh i think if you ask me in my humble opinion uh

should it be implemented like at this juncture maybe not but would it happen in the future maybe yes but having said that i guess as i mentioned there should always be like a a check and balance right to see whether whatever um data that we have actually gathered uh online is actually true versus to what's offline so yeah i hope that answered the question thanks

xiaomi and maybe we can hear a bit from cliff as well because on the database perspective right so how do you check uh corporates uh in terms of their relationship and beneficiary relationship as well yeah so so we you know ultimate beneficial ownership has always been one of the uh hot topics that our clients have asked us if we could do this and this is one of the the toughest things to to trace um so what we do is that for you know state-owned enterprises is will drop all the companies that's related

all the subsidiaries um for sanction related companies who will look out for companies that are owned uh or owned by a central individual owned by a sanctioned company but for the normal private companies uh we usually will work with a partner uh to provide ubl data yeah thanks cliff and we have one last question uh before we wrap up so ekyc requirement must always find your balance right you want to onboard at the same time you have the authentication process either achieve

the compliance needed and inhibit fraud so without alienating good customers but it is sometimes cumbersome and time consuming and that may turn away good customers so what are your comments what are the simplest easiest way to avoid this um is it by involving manual kyc uh okay i think i'll take that so okay if you ask me uh in this day and age what is cumbersome

right if you okay what versus you basically um having being able to open an online account or mobile wallet within five to ten minutes versus you know walking into like a bang or outlet right filling up 20 pages of form submitting it to like the officer and wait for like a week later to get your responses so i mean basically you know i i mean if you ask me um if you haven't tried the

may e-wallet onboarding process please go and try it out it's very simple and i do not think it's actually cumbersome um but i guess it's basically you know how we can actually enhance or actually uh even make the process more seamless so and this is actually something that you know everyone is actually looking into today uh maybe at this juncture some of the steps or some of the mobile wallets out there requires like maybe 20 steps for example but maybe in future it might should be

down to six steps and if your question is actually pertaining to uh manual kyc um that is also done uh in today's world as well but it's actually case by case basis because you can't have like you know one or two persons sitting there holding to go through say maybe you know tens of thousands of people actually applying for something per day so that means that actually doesn't you know translate to the efficiency uh in terms of what

we're looking into today so therefore you know i mean if you ask me of course ekyc is the way moving forward but of course what really what really is important is that you know all the data or all the uh basically risk right has to be put in place so that you know your data or our data as a as a user is actually not compromised thank you man i think one last question to all panelists before i wrap up thank you everyone for staying on uh so i think what is i guess a word or a question um

from your personal point of view towards ekyc and aml in the future leading to digital bank and deal back in asia pacific what are your thoughts or feelings or any comment actually hi jenna i just want to share a comment that the ekyc represented a lot of new opportunities to our clients uh it is borderless like it cuts across markets and it expands it gives a very

quick way for you and a good business idea to reach a much wider market i i think that uh where where it is feasible uh i think business ideas should really expand uh where your your clients that you can onboard may not be coming from only a single market itself that when you're planning and preparing your business plans and going to your shareholders i think that this is where the whole digital economy and the opportunities it represents can can fully be leveraged this is just a

i think idea yeah thanks federer uh what about cliff yeah i think i think we are very lucky to see this uh you know in this digital era um sbc and i think it's from from a larger standpoint i think because i've worked in south station for so many years one thing that i really like to see is how the digital banks can really help you know many of the unbanked uh you know micro loans and all that stuff to you know to create more of an inclusive um society i think that's one part that i'm looking forward to the most but of course you know the kyc part is

something that is um you know without a shadow of doubt that it's really important i mean even if it is for the unbank i think it's important to do at least uh basic to uh kyc to advance kyc depending on the profile of the customers yeah thanks cliff and then robin to you i think it's great i mean if you look at it from a user experience perspective i mean you're not you know that the only branches period right it's it's it's it's it's a game changer and i think you know in a former life i got to

work with fred and we were able to onboard some customers in as little as like 30 seconds right it was it was it was um it was amazing just to see that so um so yeah i i'm i'm all for it thanks robin and jermaine what what are your thoughts and comments um i think as i mentioned earlier of course i think you know ekyc is definitely a future but i mean having said that we also have to look at like i mean if you're talking about southeast asia it really pertains on different i

mean the different geographic and the different lifestyle of the uh the country as well but i mean from a malaysian perspective we are definitely moving forward with it thanks sherman so i think we're going to take a group photo just just for the sake of uh this panelist and uh i'll just say one two three right one two three thanks everyone so i think uh as a wrap up uh thank you panelists and thank you

for everyone who stayed on we will be sharing the slides and the recordings as well um where the penalties uh has has generally generously actually gave a copy for this and thanks robin sherman frederick and cliff so wait one more last shot one two three okay awesome so yeah thank you everyone have a good night have a great dinner and if you have any more questions actually uh feel free to reach out to any of us

uh i'm gonna briefly share the screen of some of the emails oh wait just just i already shared so yeah thank you everyone take care bye bye thank you thank you everyone