Speakers from Lloyds Banking Group, Monzo and NatWest Group urged the financial services industry to “work together” to get a digital company ID live in the market and said it would help identify financial crime “sooner”.
It comes after the Centre for Finance, Innovation and Technology (CFIT) proposed the widespread adoption of Digital Company ID to tackle economic crime, following the work of its second industry coalition.
One of the recommendations made in the coalition’s report is that CFIT, in collaboration with industry, should launch and test a fully functional Digital Company ID prototype.
At CFIT’s ‘Fighting Economic Crime through Enhanced Verification: Coalition Showcase’ last week (6 March) hosted at Mastercard’s offices, Leon Ifayemi, director of coalitions and research at CFIT, moderated a panel discussion with representatives from the three banks.
Mark Devlin, managing director client services, business and commercial banking at Lloyds Banking Group, told Ifayemi that IDs have been “tried and tested but never quite got off the ground”.
He called on the financial services industry to “work together to get past the proof of concept”, as had been done with Open Banking, and to “maximise the opportunity now or it’s lost”.
Devlin spoke alongside Phalé McMillan, head of financial crime risk management and deputy group MLRO at NatWest Group, and Aisling Twomey, Monzo’s senior financial crime manager.
Twomey told Ifayemi that a company ID could help banks, such as Monzo, “spot” financial crime seven to 10 days sooner than currently, and said that banks are “losing time through current sludge-like processes”.
She added that getting CFIT’s Digital Company ID live could be an opportunity to “test and learn”, adding that it “doesn’t mean we can’t make changes and develop further down the road”.
McMillan said that corporate ID will help businesses to identify customers and to “focus… on managing risk”.
She added that the “end goal” with a digital ID is that “the customer wins”.
Lessons from other countries
CFIT chair Charlotte Crosswell
At the CFIT Coalition Showcase, Charlotte Crosswell, chair of CFIT, moderated a Fireside Chat with Steve Smart, the Financial Conduct Authority’s joint executive director of enforcement and markets oversight, and executive director lead for financial crime.
Smart told Crosswell that the UK must “do more internationally” in the fight against economic crime. Given that “jurisdictional boundaries don’t matter for the criminal”, he said that the UK has to “find a way to make it not matter for us”.
Crosswell asked Smart about the countries he thinks are leading the way in their approach to tackling financial crime.
Smart highlighted South Asia, where he said the UK “can learn from them on fraud and scams”.
In Europe, Smart pointed to France, citing his French regulator colleagues as being “focused and quick”, as well as being “prepared to accept a bit of risk”.
He also discussed the need for Big Tech companies to be “part of the solution” to the rise in scams and fraud, citing the statistic that 75% of fraud starts online.
Further reading: CFIT secures industry partners to lead next coalition
