European Banking Authority Publishes Final Guidelines on Remote Customer Onboarding

The European Banking Authority (EBA) has issued its final policies on remote customer onboarding solutions. These guidelines involve credit and financial organizations that are within range of an AMLD.

The Guidelines outline the measures that credit and financial companies should take to guarantee safe and efficient remote customer onboarding procedures in compliance with current AML/CFT regulations and the EU’s data security framework.

The standards meet basic EU standards for the formation and implementation of reliable, risk-aware new customers’ due diligence guidelines and practices in the context of remote client onboarding. They outline the procedures financial institutions should follow when selecting tools for remote customer onboarding and while evaluating the suitability and dependability of such solutions in order to meet their AML/CFT requirements efficiently. The Guidelines don’t favor the usage of any particular technology and are not technologically biased.

The policies were issued in response to the European Commission’s demand n the context of its 2020-released Digital Finance Strategy. Additionally, they are consistent with the EBA’s legislative obligation to direct, coordinate, and keep an eye on the EU financial sector’s battle against money laundering as well as terrorism financing.

The Anti-Money Laundering Directive (AMLD) outlines what financial firms need to do to fulfill their AML/CFT duties, but it does not specify in detail what is and isn’t permitted in a distant and digital setting when enrolling new customers. Because of this, there were risks associated with ambiguous regulatory requirements for the methods of remote onboarding used by financial and credit organizations. Additionally, it has really made it more challenging for financial and credit companies to adopt new or cutting-edge methods of customer identification. Even during the Covid-19 outbreak, the demand for non-face-to-face client take-on choices increased, which exacerbated these threats and issues.

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