And the winners of the #Innotribe Start-up Challenge are … (#Sibos 14)

Waking up on day four, the final day of SIBOS, I am greeted by yet another hazy sunny morning and a complementary hazy head.

That's normal.

So finishing off day three was a wonderfully relaxed experience.

First, congratulations to the winners of the Innotribe Start-up Challenge at #Sibos!

The top Start-up is KlickEx (who gave everyone free WiFi during the vote, so not a bad move) and the Best Innovator is Waratek.

Second, thanks to the Financial Times we had a nice start to the evening up the top of the Jumeriah Emirates Tower Hotel.  As with everywhere in Dubai, great views and great service.

Then it was up to the top of the JWMarriott Marquis, the tallest hotel in the world, for a dinner high in the skies with some friends and finally dropping into bed relatively early in order to be prepared for tonight's end of show party.

SIBOS Daily Issues asked me to write a piece for them, so I thought I would share that with you, to kick of the morning if you have not seen it already:

SWIFT goes
broad and deep, but is it broad and deep enough?

It amazes me
how every year the reach, depth and breadth of SWIFT goes further, broader and
deeper than ever before, but is it enough or is it too much? Can SWIFT be all
things to all people, or does it need to focus on the core competency of its
origins: moving messages between banks globally?

I only ask
this question because when I first started coming along to SIBOS too many years
ago, it was a payments conference and exhibition.  Then it became a
payments and securities show.  Now it is a panacea of all things related
to banking, and the opening plenary and announcements showed the further
expansion of this panacea into sanctions controls.

If you didn’t
see those announcements there were two sanctions related activities.  The
first is a sanctions screening service for small to medium sized banks and the
second a sanctions testing service for large banks.

Admittedly,
on the back of the HSBC and Standard Chartered fines from the USA for breaching
money laundering rules, this makes sense, but it doesn’t go far enough.

Samir Assaf,
HSBC's Head of Global Banking and Markets, made a plea in the opening session
for SWIFT to do more and remove the need for banks to reinvent wheels. 
Those wheels included KYC, Know Your Client, requirements for client
onboarding.

Now this is
an area that’s been a big issue for all banks for years.   Every time
an account is opened anytime, anywhere, the client has to provide documentary
proof that they are who they say they are, and the bank has to check that this
individual is not a PEP (Politically Exposed Person) for AML (Anti-Money
Laundering) purposes.

The question
is: when this has been completed once, why should the client and the bank run
this check every time thereafter.  Couldn’t we just hold all that client
data in a shared global database that all banks could then verify credentials
against?

That may
sound like a dream, but PayPal get around KYC by using the bank account behind
the PayPal account to check you are who you say you are.  If you have a
bank account, then they know that you completed KYC checks at account opening
and if it’s good enough for the bank account opening, it’s good enough for the
PayPal account opening.

Why can’t we
all do the same?

So this is
SWIFT’s next big challenge: to create a global central database of client
documentation to manage the KYC and account opening processes for the bank
constituency.

That’s a big
project, but SWIFT is up for the challenge as they’re already working on
it.  Talking to SWIFT representatives around the show, they confirm that
there will be a global KYC database provided for corporates.

Fantastic.

Any global or
international business will therefore be able to open accounts in new
territories without having to go through the hell of the KYC/AML process every
time.

That’s the
dream anyway and, as we have this dream, the only question that remains is
whether the global objectivity and neutrality of the SWIFT cooperative can be
retained, or whether the institution becomes even more of a geopolitical
football.  That’s a theme I’ll come back to tomorrow.