The most difficult aspect of onboarding is being attentive while ensuring you provide your customers with the most speedy and simple onboarding experience they can get. If you are working with many customers, it makes sense to plan the process and make it as automated as feasible for all of your processes to benefit from economies of scale.
Companies that are in the lower scoring categories can move through onboarding in a short time, and it’s great to be able to automate the process and give them an effortless experience. With the help of a system for onboarding, we can move quickly to businesses that need two or three additional documents.
The procedure must be a vigorous one. A business could be considered a low risk due to ownership structure and other indications that indicate AML risk.
The Merchant Boarding Process
The initial step in merchant boarding requires a facilitator to connect to the payment processor’s native board system. Each processor offers the ability to manually sign-up merchants using an online boarding portal to which merchants can sign in. Merchant boarding can be automated through API integration to cover the customer resource management system.
After a connection is created, an application may be made. Applications are also referred to as Merchant Processing Agreements. These agreements include all the pertinent information that payment processors require to decide whether to accept an additional merchant. The information includes:
Company information and documentation.
The details of the merchant’s business.
The know-your-customer (KYC) document.
Documentation for the account.
Other requirements can be used to determine the underwriting process.
Once the application is accepted, the processor, wholesaler, or payment facilitator, will decide whether or not they will allow the brand new business. The final decision boils down to whether or not the processor considers the new merchant trustworthy and if they believe that the potential revenue the new company will bring outweighs the risks of accepting the account. The process of boarding the merchant is extremely fast if the merchant’s application and documents are up to date, and the sales company, independent of the boarding process, doesn’t make any mistakes in the submission procedure. When something goes wrong in any of these areas, it may cause bottlenecks that cause delays and, in an unnecessary way.
8 Things to Take into Consideration when deciding on the right merchant onboarding service
Centralize all operations
Digitize to streamline and automate the important steps of onboarding your merchants with our cloud-based solution built into Microsoft Azure.
Access official documents
Our technology is a proprietary source of official documents from registries of companies in real time. This protects your company from the threat of fraud using reliable data.
Explore multiple-layer structures
Access instantly detailed corporate structure charts regularly created by our software. This will aid you in your research and provide security.
Easily meet your reporting
Each step taken by team members is documented in an unchangeable audit trail. KYC, as well as KYB reports, are generated automatically when a merchant is accepted.
Conduct screening
All shareholders, merchants, and directors are checked against sanctions, PEPs, and another list of watchlists at the time of entry and regularly.
Verify ID documents
Spot ID documents that are fraudulent by integrating ID Verification which is automatically performed for all passports, driving licenses, and national IDs uploaded by merchants on your website.
Always comply by using KYC
The merchants are automatically re-investigated based on their risks. Any significant changes to shareholders or directors are flagged for review. Requests for new ID documents are automatically sent to merchants before the expiry date.
Back-book of vendors
Bring your previous KYC and transaction data into your digital workspace, allowing you to centralize every aspect of your operations and ensure the future-proofing of your onboarding process and defense for the future years.
The key element to establishing an efficient onboarding process is automation. The biggest issue for businesses is manual tasks like data entry, which may need to be completed several times. Manual work can slow the process and creates the risk of human errors. Manual work also costs the overall process. It doesn’t mean individuals shouldn’t participate in working on the process. Instead, they should focus on identifying fraud, not data entry.
Automation allows for more seamless integration of the various stages. If the data is digital from the beginning, all of the processes have the possibility of automation, particularly for smaller retailers. The latest risk assessment automation, optimization, and integration tools are available, and massive improvements are already in the pipeline.
Merchant KYC
The most important aspect of the merchant onboarding process is verifying the account’s authenticity by carrying out KYC procedures for the entity. The company must exist and operate, and the account’s application must be approved.
The specific details required to confirm a business are contingent on the jurisdictional requirements; the most commonly requested information is the name of the company, a registered business or tax identification number, and a registered business’s registered address. To aid in the due diligence process, details like the nature of the company, the type of business, sales turnover, bank account information, and beneficial ownership may also be collected during the beginning of the form-filling phase.
The KYC procedure not only gives details that meet the legally required requirements but will also provide information on the additional due diligence requirements. When you add verification of fraud and personal identification requirements to the merchant identity assessment, the anonymous nature of doubtful accounts is clearer.
Merchant Monitoring
PSPs or merchant acquirers cannot end their risk management once they have completed being onboarded. What happens when a company fundamentally alters how they conduct its business, or if the number of transactions or the amounts drastically change? A change in risk assessment criteria is required to reevaluate the business’s risk. Since they could already be causing harm, the sooner this process is completed, the more effective.
Although monitoring automation has had huge success, there’s still an issue of false positives. It’s hard to refine the results, and the industry has accepted that it’s superior to alternatives. There are also problems when retailers expand into new segments or introduce new channels since the technology cannot keep up with the changes.
Technology can offer some hope for the future. The capability to digitize paper-driven procedures previously to automate manual processes and analyze and evaluate the risk with advanced tools for data analysis offers an opportunity to drastically improve the process of onboarding for merchants. Merchant acquirers who embrace the latest technologies can reduce costs and earn more profit while managing risks.
The global payments market continues to expand in both complexity and size. Merchant acquirers and their partners are faced with new challenges in managing the risk. On a global scale, the flow of fraud continues from the physical world into the ever-growing CNP environment. In the same way, the value chain of acquiring has become more complicated with the rise of marketplaces and payment facilitators.
Conclusion
Knowing the risks that merchants face and how to reduce the impact of the particular situation can help you ensure security and speed. The careful use of automated workflows, efficient risk management of merchants, and KYC processes can accelerate successful merchants’ onboarding process while preventing the creation of accounts with problems.
Improve the merchant onboarding by using Taskmo
Taskmo is conscious of the difficulty and inefficiency of the traditional method of onboarding merchant services and the stress they create. We’ve been at the high edge of the market for a long time and believe there’s a better approach. Our unique approach to managing merchants’ journeys is designed to streamline the entire process by using our knowledge and expertise to help our clients overcome every issue they face regarding onboarding.
