Meet the Experts: KYC SiteScan

January 3, 2017

In our new series, Meet the Experts, we interview top industry influencers and innovators who are shaping the future of the financial services industry.

As compliance, Know Your Customer (KYC), and Anti-Money Laundering (AML) requirements become increasingly stringent, financial services firms will need to leverage technology in order to more productively and intelligently comply with regulations at scale.

We interviewed Matt Parker, Principal at KYC SiteScan, to learn how they are helping some of the largest merchant acquirers in the world automate the KYC and underwriting process. As an industry leader in automated due diligence, KYC SiteScan serves as a key technology partner for Agreement Express, integrating with our platform to automate the end-to-end experience of onboarding a new merchant.

KYC SiteScan crawls a merchant’s website on-demand for required and prohibited content, product and service classification, and detection of policy disclosures. The automated KYC process also includes collection of consumer complaints, legal and regulatory examination, corporate entity validation, social media, and watch list screening. In a few minutes, KYC SiteScan aggregates all this data into a consistent report that can unlock auto-decisioning to make straight-through automated underwriting a reality for merchant acquirers and ISOs. We asked KYC SiteScan why automated underwriting has become such a popular concept, and what recommendations they can provide to a merchant acquirer looking to improve their processes.


Agreement Express: What made KYC SiteScan want to solve this particular problem for merchant acquirers?

KYC SiteScan: We saw demand to automate the Know Your Customer process, and noticed the stakes were being raised for merchant processors who were not properly researching and documenting KYC for each merchant. We were approached by a merchant processor who was fined $1 million by Visa for failing to have thorough, consistent KYC documentation for each merchant applicant. They were told if they did not fix the KYC problem, the fine would triple. If they still did not fix the deficiency, they would lose their Visa processing privileges, effectively putting them out of business. We knew that other merchant processors were facing a similar problem, especially growing organizations where underwriters are expected to process more applications in less time.

At around the 500 applications a month level, merchant acquirers find it increasingly difficult to be fast and efficient while still being thorough and consistent – unless they automate the underwriting process. And you can’t fully automate the underwriting process unless automated KYC is included. Manual KYC aggregation and review is usually the most time-consuming, inconsistent and expensive piece of the entire underwriting process.

Agreement Express: Why is automated underwriting becoming such a popular concept today?


KYC SiteScan: A few reasons: there’s more compliance oversight than ever, there’s increased competition from other acquirers, and there’s better technology available to help acquirers automate and scale their underwriting workflow.

With regulatory oversight increasing, acquiring banks and examiners are likely to fine or terminate merchant acquirers or ISOs if the merchant KYC due diligence process is not properly performed on every merchant. But that’s only part of the issue.

Merchant acquiring has also become increasingly competitive, with same-day or even same-hour underwriting decisions the expected norm. If industry leaders are automating their underwriting and KYC processes now, which they are, then everyone else must play catch-up. Merchants and salespeople will no longer accept even one-day onboarding wait times, and acquirers with manual underwriting processes will not survive with the high internal costs and bottlenecks of manual processes.


Agreement Express: How does a service like KYC SiteScan fit into the broader picture to make onboarding and underwriting more efficient?


KYC SiteScan: Know Your Customer is an important piece of the underwriting puzzle. We integrate through an API with onboarding and underwriting management systems such as Agreement Express, so that an underwriter can receive a digitally filled and signed application, which then automatically triggers a KYC SiteScan request as part of the underwriting process. In a few minutes, our Web Service creates a detailed report that meets and exceeds acquiring bank KYC documentation standards.

Agreement Express has a Risk Scorecard that pulls information from the merchant application and from KYC SiteScan’s data report to provide a comprehensive underwriting risk profile view for a prospective merchant. From there, organizations can enable straight-through automated decisioning. We’ve helped merchant processors achieve auto-decisioning for over 60% of merchant applications, based on their underwriting rulesets. Underwriters now only need to review 40% of applications, but in a highly efficient and consistent manner.


Agreement Express: What advice would you give to acquirers and ISOs looking to make their KYC process more efficient?


KYC SiteScan: Unless your KYC process is automated, it’s very difficult and expensive to scale, while achieving a fast and consistent underwriting process. In payments organizations where volume is growing, underwriting managers face the daunting prospect of increasing speed and throughput with the same amount of staff.

The organizations that recognize this are embracing technology like Agreement Express and KYC SiteScan to automate the onboarding and KYC process, allowing underwriters to do what they do best: make informed risk decisions, not manually collecting KYC data and wading through it. Automated KYC, together with an onboarding platform like Agreement Express is a powerful combination that allows payments organizations of all sizes to scale their merchant onboarding and underwriting, while dramatically reducing costs.


Interested in learning more about creating a plan for underwriting automation? Download our complimentary guide