Financial institutions are under growing pressure to onboard clients at speed, while still proving they can meet tightening regulatory expectations.
According to KYC360, Commercial teams want fewer drop-offs and faster conversions, but compliance teams need confidence that every check is defensible, traceable, and ready for audit. That push-and-pull often leaves firms trying to scale growth on top of processes that were never designed for digital-first onboarding.
In practice, onboarding friction tends to come from the same sources: disconnected systems, manual reviews, and repeated requests for the same documents and data. These inefficiencies don’t just slow teams down; they also damage the customer experience. In banking, 63% of customers abandon the digital onboarding process before completion, according to a 2020 Signicat report.
The problem becomes even more pronounced when onboarding involves multiple parties. In introducer-led or intermediary-driven models, the same client may be onboarded separately by advisers, trust and corporate service providers, and banks. Each organisation collects KYC data independently, triggering duplication, inconsistent records, and delays that can frustrate everyone involved, including the client.
A growing response to these structural issues is Networked KYC (nKYC). The concept enables secure, consent-based sharing of KYC data between the parties involved in the same client relationship. Instead of treating every onboarding as a standalone exercise, nKYC allows verified identity information, supporting documentation, and audit history to be shared electronically between named providers within a chain, with relevant data fields pre-populated into each recipient’s workflow.
Crucially, nKYC is not positioned as a centralised data utility. It operates on a point-to-point basis, with sharing restricted to explicitly authorised recipients and governed by documented client consent. That design matters, because it supports more controlled reuse of information while avoiding the “one-size-fits-all” pitfalls associated with broad data pooling models.
Even so, data reuse does not remove regulatory responsibility. Each institution remains accountable for its own customer due diligence decisions, and regulators expect firms to maintain strong controls even when information has been sourced elsewhere. Global standards reinforce this position. The Financial Action Task Force’s Recommendation 10 requires that any reused or shared identity data meets the standard of being reliable, independent, and fully auditable. In other words, firms must be able to demonstrate where the data came from, how it was obtained, and how it has been maintained.
Data protection rules, including GDPR, introduce another layer. Where KYC data is shared, organisations must be able to evidence lawful processing, explicit consent, data minimisation, and appropriate safeguards. Cross-border onboarding can add further complexity, particularly where verification standards and supervisory expectations differ between jurisdictions.
Networked KYC aims to address these requirements by design. Shared information is accompanied by a detailed audit trail showing who provided the data, when it was captured, and how it has been handled. Just as importantly, risk decisions are not transferred. Each receiving party applies its own controls, governance, and risk model, preserving accountability while still removing duplication from the process.
For firms considering nKYC, provider due diligence becomes a key decision point. Organisations should assess whether a solution supports selective, field-level sharing rather than indiscriminate document transfer, and whether it preserves a full audit trail covering origin, capture method, and change history. Screening capabilities also matter: access to strong PEP, sanctions, and adverse media datasets can help ensure the shared onboarding workflow still supports effective risk identification. Practical fit is just as important, including integration into existing onboarding and lifecycle workflows, configurable processes for different client types and risk appetites, and security controls suitable for sensitive KYC data. For multi-jurisdiction use cases, the ability to map data reuse to local AML requirements and handle cross-border onboarding safely should also be evaluated.
Ultimately, nKYC represents a shift in how onboarding can operate in multi-party environments. By enabling secure, consented sharing of KYC information between trusted parties, it reduces duplication at the source and supports onboarding processes that can move far faster—turning timelines that once stretched into months into outcomes measured in days. For organisations working with introducers and intermediaries, Networked KYC offers a route to better speed and client experience, without losing the regulatory assurance that compliance teams need.
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