Launch of the "one-stop shop" to speed up investor onboarding is imminent.

Islamabad: A centralised digital site, or sort of one-stop shop, will be launched by the authorities in the coming weeks to streamline investor onboarding and comply with international anti-money laundering requirements. Users will be able to submit their credentials for the whole financial market through this portal.

The Centralised Gate­way Portal, a new digital system, is intended to simplify digital onboarding of investors in various asset classes in the regulated industries and prevent repetitive know-your-customer (KYC) processing. The Central Depository Company (CDC) has already been given the go-ahead to implement this method by the Securities and Exchange Commission of Pakistan (SECP).

Industry leaders and experts anticipated that the site will encourage more individuals to invest in Pakistan and assist the nation in adhering to the regulations set out by the Financial Action Task Force (FATF), an international organisation established to combat the financing of terrorism and money laundering.

CEO of CDC, Badiuddin Akber told Dawn that "The Centralised Gateway Portal is actually going to change everything." It is intended to make investing easier for individuals and to assist financial institutions in automating their onboarding process and lowering the cost and complexity of storing client data.

Even for similar asset classes, the present onboarding procedures for various asset categories vary, and clients may need to repeatedly submit their information to several companies. According to Mr. Akber, "At the moment, each company conducts its own KYC procedures, necessitating that a person repeat the same screening every time he wants to invest with another company."

"There isn't a single location where someone can submit their credentials and conduct screening; as a result, the same should be made accessible to the whole financial sector. We created this site based on SECP's recommendations, and it will be operational within a few weeks, he added.

An asset class is a collection of investments that share similar traits and may be governed by the same laws and rules. Stocks, fixed income, commodities, and real estate are typical examples of asset classes.

According to Mr. Akber, the Centralised Gateway Portal provides financial institutions and investors with a platform that enables them to solve any onboarding concerns relating to various asset classes by having a centralised account for KYC information and paperwork.

"Investors will find it simpler to onboard a variety of asset classes via a centralised platform thanks to the portal's unique approach of offering a one-stop solution for numerous asset classes. The system will also assist financial institutions in managing consumer data and streamlining the onboarding process, according to the CDC head.

An "achievement" for the government and financial market regulators is that it is now possible to keep records of persons investing money in the financial sector with all pertinent information. This investor convenience has also emerged as an advantage for investors.

Managing PEPs

Following Pakistan's removal from the FATF's worldwide grey list last year, which necessitates tighter surveillance for terrorism funding, an official stated that "we need to be more cautious and careful."

As a result, Pakistan is better able to comply with the FATF's established process thanks to this new capital market structure. According to our financial market laws, it's the next big thing, he stated.

The platform would allow market regulators and operators to maintain tabs on people, according to the official.

Furthermore, when dealing with politically exposed persons (PEPs) — individuals in prominent public positions who may be vulnerable to corruption — market regulators and operators would remain vigilant and take all precautionary measures as defined by local authorities and regulatory bodies, he added.

FPM AML-Check, a subsidiary of First Paramount Modaraba that collaborated with the CDC for screening Anti-Money Laundering/Combating the Fina­n­cing of Terrorism (AML/CFT) checks using the newly established portal, has amassed a large database of local PEPs.

The business claims that over the past several years, it has had substantial interactions with various businesses in Pakistan, assisting their AML/CFT compliance teams in resolving typical issues.

According to Syed Wajih Hassan, the CEO of FPM, "during this time, FPM got valuable insights about the screening practices of the industry and was able to identify barriers that fail businesses in adequately mitigating the risks associated with financial crime and financing of terrorism."

He stated that FPM's processes for obtaining PEPs information were entirely compliance with international organisations' standards and best worldwide practices.

According to Mr. Hassan, the organization has organized its PEP data in accordance with the FATF's definition of the term. "We have further expanded our coverage to the areas that are significant for AML compliance in consideration to the domestic norms of the country," the man stated.

He stated that a high-level classification of PEP data could be found in institutions and areas such as government, legislative bodies, judiciary, diplomats, municipalities, state-owned enterprises, ministries and bureaucracy, law enforcement and security, political and religious groups.

"In terms of data update, PEP sources where frequent data updates are expected, the FPM research team keeps a constant watch through automated or semi-automated means, and any new information found is scheduled for acquisition on an immediate basis," stated Mr. Hassan.

Data gathering is scheduled in accordance with sources where information is made accessible at regular intervals. When there is no expectation of new information on existing PEPs data, the default review cycle is every six months. The PEPs' data that FPM uses for AML screening is gathered from a variety of administrative, governmental, and other sources, the official added.

This article was originally posted by dawn.com