Update: The Monetary Authority of Singapore has released a circular on 8 Jan 2018 regarding using MyInfo as an official source for customer onboarding. Financial institutions would not need to obtain a photograph of the customer separately. For more details, please click here.
The Monetary Authority of Singapore (MAS), has released a consultation paper on changes to anti-money laundering / countering the financing of terrorism (AML/CFT) requirements imposed on Money-Changing and Remittance Businesses (MRBs) – MAS Notice 3001. At present, all MRBs are required to seek approval from MAS before establishing a relationship via non-face-to-face.
Strict non-face-to-face controls are necessary as businesses dealing with non-face-to-face customers increase the risk of money laundering or terrorist financing as verification of identity becomes inherently more difficult. Financial institutions without adequate risk management policies increase the risk of impersonation fraud and the difficulty of tracing funds.
The 40 Recommendations, set out by the Financial Action Task Force (FATF), requires financial institutions to address specific risks and issues related to non-face-to-face relationships and transactions with adequate policies and procedures. When conducting customer due diligence, MAS requires non-face-to-face transactions to be as stringent as face-to-face transactions. A paper published by the Basel Committee on Banking Supervision recommends measures that include obtaining the certification of true copies of documents presented.
However, such strict controls reduce operational efficiency and add to compliance costs.
Singapore’s Answer – MyInfo
Managing Director of MAS, Mr Ravi Menon said in a speech:
KYC is one of the biggest pain points in the financial industry. It is an obligation in any customer on-boarding. But the process is costly, laborious, duplicative, and still not all that effective in detecting tax evasion or money laundering.
The government has taken the first step with MyInfo – a single platform containing personal data submitted to and verified by the government. MAS and the Government Technology Agency of Singapore have done a pilot with several banks to enable customers to open a bank account online using MyInfo. The pilot saw application timings shortened by as much as 80%.
MyInfo is a digital vault of personal information that is endorsed by the government. Users of MyInfo no longer need to fill up physical forms and provide scanned copies of their identity documents as it is automatically retrieved at a click of a button located on online forms of participating companies. Consent will be sought from users before data is transferred and users can choose to be alerted should any e-service use their personal data. All Singpass users are automatically registered to MyInfo.
At the time of writing, DBS, UOB, OCBC, Standard Chartered Bank and insurer Etiqa is known to accept applications via MyInfo.