The Global Legal Entity Identifier Foundation (GLEIF) has revealed that 57 percent of senior salespeople in banking spend more than 27 percent of their working week onboarding client organisations.
The research carried out by GLEIF recorded findings on the challenges of entity identification in financial services and proposes a standardised way forward.
The research also found that 50 percent of financial institutions use, on average, four identifiers to help identify client organisations.
The survey was carried out with over 100 senior salespeople in the banking sector in the UK, US, and Germany.
The survey showed that the process of client onboarding, including now your customer and due diligence, was shown to take six weeks, on average.
Other key findings included results revealing that 57 percent of respondents agree that reliability of reference data is a challenge.
Additionally, 55 percent of respondents agree that the resourcing of onboarding is a challenge and a further 55 percent agree that lengthy processes mean risk of business loss.
The research also showed that 61 percent of respondents agree that digital technology will further complicate the process.
Stephan Wolf, CEO at GLEIF, commented: “Our research results show that the onboarding process for new business relationships in financial services is too time-consuming and requires too much administration. However, the growth of identifiers is leading to problems that must be resolved to assure their vital place in oiling the wheels of the growing global digital economy.”
Wolf added: “Identifiers of legal entities are easily obtained from a host of different issuers but are not kept up-to-date in a systematic way. Organisations need a more efficient system for legal entity identification. Some think technology will help but there is no general consensus about what the solution should be.”
Wolf concluded: “Integrating the legal entity identifier (LEI) into other entity verification methods, including solutions based on digital certificates and blockchain technology, will allow anyone to easily connect all records associated with an organisation and identify who owns whom.”
“By becoming the common link, the LEI will provide certainty of identity in any online interaction, making it easier for everyone to participate in the global digital marketplace.”
