This is an excerpt from our guide Enhancing Sponsor Bank Compliance: Guide to Synctera’s Risk and Compliance Tools. This is part 2 of 3 and you can view the entire guide here.

Banking-as-a-service (BaaS) infrastructure has enabled a surge of financial innovation and a new way for banks to grow their business by increasing core deposits and generating revenue through non-interest income and other fees. Yet, some banks hesitate to launch BaaS programs, often due to concerns around limited visibility into end-user identities and activities. 

Synctera reduces these concerns by not only equipping sponsor banks with comprehensive tools to meet their own Customer Identification Program (CIP) requirements, but also by centralizing all end-user activity and data, from multiple data sources, in one unified platform. 

The Synctera Console, the user interface for the Synctera Platform, provides sponsor banks with a centralized access point to an array of risk and compliance tools and visibility into all CIP-related data. From KYC and risk mitigation to transaction monitoring and limit controls, the Synctera Platform provides the tools  sponsor banks need to grow confidently. Let’s take a closer look at our customer onboarding tools! 

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Customer Onboarding: Meet Customer Identification Program (CIP) requirements

One of the most vital components of compliant sponsor banking partnerships is ensuring that the identities of all new end-users are verified before onboarding and approving accounts. This verification process aids in the prevention of money laundering, terrorist financing, and fraud. Synctera supports a bank’s CIP requirements with integrated Know Your Customer (KYC), Know Your Business (KYB), and sanctions screenings, ensuring that all customer identification data is centralized within the Synctera Platform and Console. 

When a customer uses the Synctera APIs to onboard an end-user, they are required to pass consumers and businesses through a KYC or KYB decisioning workflow. The Synctera Platform provides flexibility to support different ways of ensuring CIP compliance. Sponsor banks have complete control and visibility into the CIP requirements, whether it’s leveraging Synctera’s integrated KYC and KYB solution or using the “off-us” KYC API to pass along KYC and KYB results from their preferred vendor. 

If a KYC or KYB decision is not automatically approved or rejected, it will trigger a manual review, which automatically creates a case. This allows the customer and the sponsor bank to collaborate on a resolution based on the sponsor bank’s KYC or KYB standards.

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Customer Risk Rating: Improve the understanding of end-user risk

Synctera’s Customer Risk Rating (CRR) was designed to quantify the risk associated with an end-user, categorizing them into three levels: Low, Medium, and High. The CRR is calculated after KYC or KYB processes and is based on several end-user parameters, such as geography and tenure. Customers can also upload additional end-user information to factor into CRR using the Enhanced Due Diligence API. A recalculation is triggered whenever an end-user’s parameters change. CRR enables sponsor banks to better understand the risk profiles of their customers and end-users.

An end-user’s CRR can easily be viewed in the Synctera Console, including details on what parameters affected the score.

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This is an excerpt from our guide Enhancing Sponsor Bank Compliance: Guide to Synctera’s Risk and Compliance Tools. This is part 2 of 3 and you can view the entire guide here.

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