Customer Remote Onboarding: How to Comply With the EBA’s Guidelines

In 2022, the European Banking Authority issued Guidelines on the use of Remote Customer Onboarding Solutions. These guidelines aim to clarify permissible practices within the digital remote context and will be enforceable for financial institutions starting October 2, 2023.

Before selecting a remote customer onboarding solution, financial institutions should carry out a pre-implementation assessment, which includes:

Evaluation of tool’s accuracy and completeness of collected data
Risks posed by the use of the solution and possible mitigation measures, including ML/TF, operational, reputational, and legal risks
Solution’s susceptibility to fraud (e.g., impersonation), information and communications technology, and security risks
Tool testing on customers, products, and services identified in policies and procedures

According to the EBA Guidelines, remote customer onboarding policies and procedures should be risk-sensitive and include at least the following:

General description of customer identification solution, explaining its features and functionality
Description of customers and services that are eligible for remote onboarding
Which steps are fully autonomized and which require human intervention
Controls to ensure that the first customer transaction is executed only when all customer due diligence measures have been applied
Employee training on the remote customer onboarding solution
Description of what customer information is entered manually by the customer; automatically captured from the documentation provided by the customer; gathered using other internal or external sources

Lastly, financial institutions are expected to perform ongoing monitoring/testing of the remote customer onboarding solution on periodic and ad-hoc cases. Remedial steps should be taken for any shortcomings identified while using the tool.

Considering the requirements set by the EBA Guidelines, ECOVIS ProventusLaw recommends updating the AML/CTF documentation and performing testing of the used customer onboarding solutions to ensure full compliance with the EBA Guidelines and Lithuanian regulations.

Prepared by Vilius Neverdauskas, Associate of ECOVIS ProventusLaw