KYC for Wealth Management in the UK [2025]

Onboarding is a critical step in wealth management. It’s the first real interaction with clients and sets the foundation for a long-term relationship. Yet, traditional onboarding processes are often plagued with challenges—delays caused by manual document checks, errors in verification, and vulnerabilities to fraud.

For high-net-worth individuals (HNWIs) and wealth management firms, the stakes are even higher. Ensuring security, compliance, and a smooth onboarding experience is essential to build trust and protect against financial risks.

This is where Open Banking KYC solutions come into play. By leveraging real-time data from banks, Open Banking simplifies the onboarding process, allowing wealth managers to verify identities instantly, conduct accurate financial checks, and reduce the risk of fraud—all while improving the client experience.

In this blog, we’ll explore:

Traditional vs Open Banking KYC for Onboarding

Traditional KYC

Traditional KYC processes in wealth management are often manual and fragmented, leading to inefficiencies and higher risks. Firms must collect and verify multiple documents—like identity proofs and financial statements—through separate systems, which can be time-consuming and prone to human error.

Some common issues include:

• Delays in Onboarding: Manual verification can take days or even weeks, frustrating clients.
• Fraud Vulnerabilities: Documents can be easily forged, increasing the risk of identity fraud.
• Inconsistent Accuracy: Human errors during document verification can lead to false results.

Open Banking KYC

Open Banking brings real-time data access into the KYC process, eliminating the need for manual document checks. Instead of waiting for clients to provide documents, wealth managers can directly access verified bank data to confirm identity, check financial history, and assess risks.

Benefits of Open Banking KYC for Wealth Managers:

• Real-Time Data Verification: Quickly confirm a client’s identity using their bank records.
• Reduced Manual Effort: Automate the verification process to minimise errors.
• Improved Client Experience: Faster onboarding reduces drop-offs and leaves a positive impression.
• Better Fraud Prevention: Access to live bank data helps spot discrepancies that manual checks might miss.

By replacing outdated methods with Open Banking, wealth management firms can offer a smoother, safer onboarding experience while ensuring compliance with regulations.

📚 Faster Onboarding using bank validation

Customer Onboarding for Wealth Management

For wealth management firms, a robust and secure onboarding process is key to building long-term client relationships. Our suite of APIs not only speeds up onboarding but also ensures accuracy and security at every step. Here’s a detailed look at how our services support each stage of the journey:

Initial Identity Verification Using Bank Data and Facial Recognition

What Happens:
The first step in onboarding involves verifying the customer’s identity using our Verification API. This API gathers information from multiple sources:

• Bank Data: It accesses real-time data from the customer’s financial institution, confirming that the provided name matches the bank records.
• Facial Recognition: The API extracts data from an identity document (like a passport or driving license) and compares the image with a selfie supplied by the customer. A similarity score is generated to indicate the match quality.

Why It Matters:

• Speed & Accuracy: By using bank data and facial recognition, the process is much faster than manual checks and reduces errors.
• Enhanced Security: The similarity score and real-time verification help prevent identity fraud.
• User-Friendly Onboarding: Customers enjoy a simple and quick verification process, laying a strong foundation of trust in wealth management services.

📚 Guide to KYC Verification Process

Financial Background Check (Source of Funds Verification)

What Happens:
Next, our Open Banking AIS API comes into play by providing financial insights into the customer’s cash flow:

• Access to Transactional Data: The API retrieves real-time transactional data from the customer’s bank account, which includes details such as balance, transaction count, and cash flow volumes.
• Verification of Name & Financial Profile: This data is used to verify that the customer’s name matches the bank records, and to assess the source of funds and overall financial health.

Why It Matters:

• Risk Management: Having a clear view of the customer’s financial activities allows wealth management firms to make informed decisions.
• Regulatory Compliance: Real-time financial insights ensure that the source of funds is verified, reducing the risk of fraud and meeting regulatory requirements.
• Data-Driven Decisions: The detailed financial report supports deeper financial analysis, which can be used to refine credit scoring and other risk assessments.

Why Choose Finexer for Onboarding & KYC

When it comes to onboarding clients in wealth management, Finexer is a trusted partner. Our suite of APIs is built to make the process secure, clear, and efficient. Here’s why wealth management firms consistently choose Finexer:

1.Accurate and Fast Identity Verification

• Real-Time Bank Data
  Finexer’s Verification API quickly confirms a client’s identity by comparing the details they provide with data directly from their bank.
• Facial Recognition Tools
  Our system compares a customer’s selfie with the image on their identity document, producing a similarity score that confirms identity with confidence.
• Speedy Onboarding
  Automated checks mean that client verification happens in minutes, cutting down on the lengthy delays often associated with manual processes.

Added Benefit:

• 3x Faster Deployment
  From initial setup to going live, our API-based approach can be integrated up to three times faster than fully custom-coded solutions. This swift deployment is especially useful for wealth management firms eager to start verifying clients right away.

2.Comprehensive Financial Insights

• Open Banking AIS API
  Access immediate, real-time transactional data to gain a clear picture of a client’s financial history.
• Source of Funds Verification
  Verify the origin of funds accurately, ensuring compliance with regulatory standards and better assessing creditworthiness.
• Detailed Reporting
  Generate comprehensive reports that integrate both identity and financial data, supporting informed decisions for wealth management.

Added Benefit:

• Start Small, Scale Smart
  Our infrastructure can handle volumes ranging from a handful of checks to thousands, so wealth managers can begin with the essentials and expand as their client base grows.

3.Security and Compliance

• Bank-Grade Security
  Finexer’s systems adhere to high-security standards, ensuring that sensitive client information is protected at every step.
• Reduced Fraud Risks
  Automated checks using real-time data and facial recognition lower the risk of identity fraud.
• Ongoing Monitoring
  Continuous data checks ensure that client profiles remain accurate and compliant over time.

Added Benefit:

• Complete Compliance Care
  Our FCA-authorised infrastructure handles all regulatory requirements behind the scenes, allowing you to focus on your core wealth management services.

4.User-Friendly and Scalable Solutions

• Seamless Integration
  Finexer’s APIs are designed to work smoothly with your existing systems, making it easy to enhance your onboarding process.
• Versatility
  Whether you need identity verification or a detailed financial check, our solutions cover multiple verification modes within a single, unified design.
• Tailored for Wealth Management
  Our platform is built to meet the needs of wealth management firms, offering a balance between quick verification and thorough analysis.

Added Benefit:

• Single-App Simplicity
  Our API-first model consolidates all features—identity checks, financial analysis, and reporting—into one platform. This setup helps reduce complexity and supports efficient workflows for wealth managers.