South African fintech start-up, ThisIsMe, says it has set a record for the FICA process, which used to take anywhere from two days to two weeks, claiming it can now complete the process within three minutes.
"ThisIsMe has set a new African record for the compliance process known as Know Your Customer and in doing so has also set a new record for the fastest FICA in South Africa," according to ThisIsMe CEO Mark Chirnside.
The more stringent, risk-based Financial Intelligence Centre Amendment (FICA) Act 2017 was signed into law, after much delay, in April. ThisIsMe says the Act is more onerous on accountable institutions, slowing down the process and making it more expensive.
The key amendment is a shift from a rules-based approach to risk-based in ensuring FICA compliance. This means accountable institutions must consider the potential risk involved with establishing a business relationship, or concluding a single transaction with a client. The intention of the new regulations is to combat financial crimes such as money laundering, terrorist funding and fraud.
"The process to establish and verify the identities of clients has largely been paper-based, with clients having to arrive at a bank branch, for instance, for face-to-face identification. This tedious process of FICA onboarding has increased costs for institutions to between R300 and R1 500 for each client," the Cape Town-based start-up says in a statement.
In the past, clients typically had to provide simple information like proof of identity, address and bank account but the new regulations require a more in-depth investigation to evaluate the risk of the client. Institutions need to check aspects such as whether their clients come from a higher risk country, the nature of their business relationships and connections to influential people like members of government.
Chirnside says ThisIsMe's digital platform makes the process faster, more cost-effective and there are fewer errors.
"The entire process is completed digitally, with machine learning technology ensuring documents aren't tampered with. In addition, we are able to ensure a client's information is regularly updated and secured. With a client's permission, we are able to verify that a client is indeed who they say they are," adds Chirnside.
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