Well coordinated, swiftly launched

A clever idea joins banks together

When a company has a clever idea, it needs a reliable partner in order to realize it. This is demonstrated by the KYC platform KEN, which AdNovum helped develop to market readiness quickly.

Today’s regulations, guidelines and recommendations for fighting money laundering and terrorism financing are neither consistent nor standardized around the world (see www.fatf-gafi.org/). This means that recognized standards are lacking and financial institutions each have to find individual rules for the know your customer (KYC) and anti-money laundering (AML) processes.

That is why most banks develop their own KYC questionnaire, which is traditionally exchanged with their partner banks by e-mail in PDF format. This manual process results in high fixed costs, both for the banks that ask for a questionnaire and those that complete one.

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The dashboard displays the status overview for a KYC questionnaire.

With the secure communication platform KEN, KYC Exchange Net AG now rectifies this lack of standardization. In close cooperation with the financial industry, the company has developed a standardized KYC questionnaire that can be filled out online on the KEN platform. The KEN platform also allows the customer to upload all required documents, manage them in a secure location and send them to other KEN members or additional participants (see graphic 2). The banks can view the customer documents anytime online and download the latest version. The relationships between the banks are managed using KEN as well. Every bank that has a relationship with another bank is informed when data or documents are changed.

Clever tactical project launch

Various hurdles first had to be overcome. The KEN concept was discussed with bank representatives early on. It quickly turned out that there was interest in such a service, provided it was simple and intuitive to use. At the same time we noticed that other companies picked up the idea and started implementing it in the same or a similar way. We saw that rapid implementation would be crucial for success. That is why we wanted to be first, offering a product to the market that the competition would find tough to beat and the banks impossible to ignore. What’s more, we wanted banks that provide KYC data via KEN by invitation of their partner banks to be so impressed by the tool that they would use it too, thereby gaining additional banks for the process.

Once the idea and business processes were outlined, we defined the detailed business requirements, including the technologies to be used, the project methodology and the security requirements for the internet application. Thanks to the greenfield approach, we were able to fully focus on performance and user-friendliness in choosing the technologies and methodology. We chose Scrum as the project methodology – an agile software development method that supports iterative (step-by-step) and incremental (building on itself) application development.

The greenfield approach gave us great freedom in choosing the technologies and methodology.

Since KYC Exchange Net AG was not familiar with Scrum, the AdNovum business analyst assumed the role of product owner in the initial phase. Once the company itself slipped into the role after a few months, the business analyst was intimately familiar with its needs and objectives. This made active support possible for the product owner in prioritizing the requirements before and during the planning meetings. The approach proved ideal. It allowed us to begin development quickly and continuously incorporate new requirements based on the discussions of KYC Exchange Net AG with its potential customers.

Prototyping approach

To give KYC Exchange Net AG an idea how the application could look early on, and for the purpose of demonstrating it to potential customers, we created several prototypes of the graphical user interface. These prototypes made it possible to adapt to new requirements quickly. The chosen technology also supported an animated presentation of the business process. We received precise feedback on requirements and changes early on as a result.
 

The division of responsibilities between KYC Exchange Net AG and AdNovum was clearly defined. KYC Exchange Net AG focused on the business requirements, presenting and selling the idea, and obtaining feedback from customers. AdNovum’s project team looked after specifying the technical requirements, developing and supplying the test, demo and production infrastructure in its own data center, and the e-mail and web infrastructure of the new company. In other words: AdNovum functioned as KYC Exchange Net AG’s IT department. Since we gained an in-depth understanding of the needs during the specification of business requirements, we were able to make many decisions ourselves and implement them promptly.

Tailor-made technical solution

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Architecture of the KYC platform KEN

Our solution combines standard products from established third-party providers with AdNovum’s own products and open-source software. In concrete terms: To protect the data of the bank and its users in the internet application, we integrated the document management system of our partner Alfresco in KEN with components from our Nevis product line (for example nevisIDM). This allowed us to ensure a high security standard for sensitive data in the application, while simultaneously enabling the efficient management of documents and forms. By combining Alfresco and nevisIDM, we were able to implement a fine-grained roles model that precisely reflects the functions and departments of a bank involved in preparing and reviewing KYC data. Together with an easy to use delegation system, this solution now allows a bank employee to transfer a KYC enquiry to the back office as part of a straightforward workflow within the bank. A dashboard displays the status of the case and percentage of completion at any time. An archive function provides an optimum overview of the closed cases.

Implementation of fine-tuned sprints

We worked with a sprint time (development cycle) of one month in the initial implementation phase and shortened this to a week towards the end of the project. Close cooperation between the KYC Ex-change Net AG project team and the development team continued in this phase as well: In parallel to the sprints, both teams worked together to define the user stories and GUI screens for the next sprint. Testing was also performed in close cooperation with the development team, which took the agile approach into account. First monthly as previously mentioned and later weekly, we established the development priorities or defined new requirements and priorities. The feedback received by KYC Exchange Net AG in discussions with its potential customers was thereby incorporated directly in development.

The first prototype served to develop a shared understanding of the application.

Visual support through interaction design

Our user experience team supported KYC Exchange Net AG with the development of an initial prototype in the conceptual phase. This mainly served to develop a shared understanding of the application. Microsoft Excel was chosen as the tool. This allowed KYC Exchange Net AG to not only comment on the design proposals but also edit them directly. Communication was more efficient as a result and development could proceed in short iteration cycles of two days. For presentations to potential customers, we used Adobe Fireworks to create a clickable prototype that simulated the typical process based on a fictitious story: From the creation of a KYC request by the initiating bank to answering the questionnaire to the release of the KYC information to the initiating bank.


While the Excel prototype primarily served to clarify the desired business process and define the individual functions, the second prototype focused on presenting the business idea to third parties. We prepared the third prototype with the goal of defining the GUI screens in detail. Therefore, it was an important part of the specification for the development team.
 

We built the third prototype with the help of an HTML5 framework. The resulting static HTML pages were suitable for direct subsequent use by the developers. In this phase we also established the look and feel of the application. Based on the industry environment and our mission to build a powerful business-to-business application, we chose a reduced and streamlined appearance. Colors are only used sparingly: The dark hue of the KYC X Net logo is found on the screen to designate the most important buttons. The colors green, orange and red were used according to their meaning in European culture.

Supplementary services

In order to simplify providing the infrastructure and the operations of the new company KYC Exchange Net AG, AdNovum assumes full responsibility for hosting the application, e-mail and the web server infrastructure under the CIOaaS concept. That saves time and effort because KYC Exchange Net AG does not have to find any other providers. Going live and installing new releases are also faster and much more efficient. We continue to support the company in the definition of its service offering and respond to enquiries from banks regarding data security. First, second and third-level support for the application completes the service package.

Authors

Rene Rehmann
Rene Rehmann, PhD in Computer Science, has been with AdNovum since 2012 as Business Project Manager and Security Officer. He focuses on security and identity management projects. In his free time he likes to frequent the golf courses of this world.

Christian Iten
Christian Iten, who holds a federal diploma in Interaction Design, joined AdNovum in 2012 and plays a major role in structuring the user experience team. As Interaction Designer, he was responsible for the visual appearance and user-friendliness of the KEN platform. Beautiful things are his passion in private life as well, especially good food and extended motorcycle tours.