Accelerate Growth by Serving International Investors

U.S. Brokerages Quickly and Easily Meet Global KYC Requirements

Buying and selling financial securities is a core part of any brokerage firm’s business. They serve a wide clientele of international investors, manage real-time trading risks in numerous markets and provide investors with increased leverage and safety. They truly need to know their customers in every sense of the word. Accelerated international growth for a brokerage firm is a promising sign; however, it also translates to new challenges — processing applications quickly enough to meet market demand while also adhering to the unique compliance and fraud prevention requirements across different countries. An effective and scalable identity verification process is a key component to meeting a diverse set of business needs and ensuring trust across the industry. By turning to Trulioo Identity Verification, a number of brokerage firms were able to quickly and easily meet global Know Your Customer (KYC) requirements while simultaneously undergoing rapid expansion into new and emerging markets.

The Identity Challenge

New customer intake is a vital step for every brokerage. As part of each customer’s application, brokerage firms need to conduct an identity verification. Before working with Trulioo, these firms were relying on paper-based documents that customers had to submit, such as photocopies of passports, driver’s licenses or national IDs. At scale and with a high number of investor applications, manual processes became arduous, resource- intensive and costly. Brokerages were at the point where they could not keep up with the number of applications they were receiving, which was significantly delaying processing times. Instead of hiring additional resources, many brokerage firms decided to make a strategic technology investment and implement an API-based identity verification system. The search for the right tool led them to discover Trulioo. With the ability to be fully operational in just over a month, integrating the Trulioo API into their processes resulted in a much more streamlined customer onboarding experience.

Technology and Human Connections

These firms rely heavily on automation for their business but often need more to succeed and meet business objectives. As steady platforms with industry- leading technology, they attract investors from all over the world and are committed to providing an exceptional user experience. Doing so means turning to smart technologies to enable smooth, high-touch processes. For example, if a customer requests that shares are purchased from a particular company, brokerage firms will locate the best price, but to do so, they need to act with agility and accuracy. Trulioo empowers them to provide this exact value proposition to customers without heavy technical overhead.

This was the case for one particular firm — the largest brokerage in the United States. Once the brokerage signed on with Trulioo, it was only a matter of weeks before their first country, China, was in production. Soon after, the brokerage noticed a remarkable change; they dramatically improved response times for the inflow of new applications. Thanks to Trulioo, they were no longer working on a backlog that forced new customers to have to wait days — or even weeks — to begin transacting. Instead, an overall more efficient process enabled the brokerage to provide a concierge-style experience that optimized the best applications of technology and human experience where each mattered most. With greater automation, the support team could spotlight situations in which a person-to-person interaction is most helpful, and even necessary, to resolve a problem. They can focus on aligning human expertise and engagement to solve problems, rather than processing documents in a robotic fashion.

Identifying Growth With Trulioo

Years after implementation, the Trulioo identity verification solution remains an important part of each firm’s long-term growth strategy. As brokerages continue to expand into higher-growth markets around the world, it’s become very clear that each country has its own unique set of challenges. While identity verification rates are high in China, with minimal false positives, each region requires a unique set of data requirements and sources, especially in light of varying worldwide compliance requirements. For instance, in Hong Kong there is no official address system such as postal codes or street names. This makes validating addresses challenging, especially because brokerage firms’ compliance protocols require an address match. The Trulioo API offered the features and benefits they needed to meet compliance and business needs: real- time identity verification and Anti-Money Laundering (AML) watchlist screening; custom rulesets; and secure access to over 450 reliable and unique global data sources to verify 5 billion people across more than 195 countries.

With just one contract and API integration, Trulioo provided each firm with a versatile solution, adaptable to varying market conditions. It’s this agility that’s empowering brokerages to push the boundaries of their business and technology. The ultimate goal is to build a real-time application approval process, and with the help of Trulioo, each firm has been able to identify the right data sources and move from ideation to execution.

Industry Background

Brokerage firms are financial institutions that facilitate the purchase and sales of financial securities. Working with an array of investors, brokers connect buyers and sellers of stocks and securities to complete trades and transactions.

With the growth of online trading, global exchanges, and an increasingly borderless portfolio of investors, brokerage firms face both opportunities and challenges as they grow and expand into new markets. Regardless of their location in the world, regulations determine how brokerages perform and operate — compliance and trust are integral parts of the business.