De-risk CLM transformation with Corporate Digital Identity (CDI)

Corporate and Institutional banks are under pressure to embrace digital transformation while ensuring compliance and efficiency and meeting rising client expectations.

Automating client lifecycle management (CLM) with AI-driven software is now a critical strategy to streamline operations, improve risk assessment, and enhance client onboarding. However, banks often face challenges in data integration and process standardization, delaying the full realization of CLM benefits. This blog explores how Corporate Digital Identity (CDI) plays a pivotal role in AI-driven client lifecycle management software, enabling banks to optimize processes and accelerate transformation.

CLM transformation

A central element in transforming client experience lies in adopting a robust CLM system. CLM’s establish a structured framework for managing corporate clients, with the goal of enhancing efficiency and consistency throughout the client journey. Furthermore, leading to a more streamlined and satisfying client experience.

Transforming the client lifecycle is a complex, multi-year endeavor. Typically taking significant investment and three to five years for planning, migration, and implementation.

While CLM platforms are highly effective at managing key processes within the lifecycle, they typically have limitations in scope. Particularly in terms of breadth and depth for specialized functions.

These limitations mean that additional steps are often required to achieve true end-to-end automation. Especially for critical elements such as Know Your Customer (KYC) processes. KYC, which is fundamental to compliance and risk management, is frequently postponed or set aside as a “phase 2” initiative. As a result, impacting the overall efficiency and effectiveness of CLM transformation.

How automating client lifecycle management improves data accuracy

Inadequate data foundations are a crucial obstacle to truly harnessing the power of CLM technology. A robust data strategy, incorporating both external, (public and privately obtained data), and internal data, is a prerequisite.

With existing manual processes for gathering data typically remaining in place at the perimeter of the CLM, they often extend client onboarding.

The reliance on manual intervention for data collection and verification introduces several risks:

• Delays: Manually collecting and verifying documents slows onboarding, frustrating clients expecting fast, digital-first experiences.
•  Compliance risks: Human error as data and documents continue to be ‘re-keyed’ and transposed between systems. Reliance on outdated or incomplete data also increases the likelihood of non-compliance with KYC and Anti-Money Laundering (AML) regulations.
• Operational strain: Manual processes burden teams, diverting focus from higher-value, strategic tasks. Poor data integration adds complexity, often resulting in a disjointed, inefficient process.

Sustaining project momentum

These factors delay the realization of CLM benefits, adding pressure on project champions and finance teams. They also increase the risk of the CLM vision veering off course as project fatigue sets in and “good enough” solutions are absorbed into Business as Usual (BAU). To de-risk CLM transformation and expedite progress, banks need to adopt solutions that provide immediate, impactful results at scale, such as Corporate Digital Identity (CDI).

Integrating CDI as part of the CLM framework is a strategic approach to de-risking the transformation. This incorporation enables a more secure and scalable journey, ensuring alignment with long-term CLM goals.

What is CDI

CDI offers a holistic view of a corporate entity through centralized information collected and curated as part of KYC processes. During onboarding, CDI automates the collection and collation of both public and private data, significantly reducing the reliance on manual outreach. Reducing onboarding times and ensuring regulatory compliance from the outset, while providing a digitized output for integration to downstream systems.

This streamlined process reduces the need for clients to repeatedly provide documentation as information is captured once and used across multiple processes.

CDI’s ability to maintain clear and auditable lineage to each data attribute, establishes a strong foundation for more advanced KYC and CLM capabilities. Particularly drawing on trusted sources of corporate information to deliver consistent and validated data, supporting a more dynamic CLM.

How AI-driven CLM software de-risks digital transformation

CDI will play a pivotal role, especially as emerging technologies like Artificial Intelligence (AI) and Machine Learning (ML) continue to advance. As AI and ML technologies mature, they will complement CDI’s data-processing capabilities. CDI’s adaptability to evolving technology means that banks can capture these efficiencies across the client lifecycle, staying agile in the face of regulatory or operational shifts.

CDI also simplifies the maintenance of external KYC data connections, as it provides a single point of access to external KYC data and documents. Banks no longer need to invest in managing and maintaining individual third-party data source connections; instead, they access these sources via one streamlined Application Programming Interface (API).

De-risking CLM transformation through AI-powered compliance and CDI

Integrating CDI with CLM software not only addresses manual inefficiencies but also strengthens compliance through AI-powered automation. CDI acts as a compliance engine within the CLM framework. Leveraging AI to streamline identity verification, continuously assess risk, and flag anomalies in real time. This reduces dependency on static data and manual review cycles, which are prone to error and delay.

By embedding CDI, banks gain immediate access to accurate, verified entity information, automate policy adherence, and achieve ongoing KYC with audit-ready precision. This intelligent automation ensures that regulatory requirements are met proactively. Protecting the bank from compliance breaches and reputational risk, ultimately de-risking CLM investments and accelerating value realization. With Encompass, banks can confidently advance their CLM programs knowing that robust, AI-enhanced compliance is built in from day one.

The path to de-risk CLM journeys

CDI de-risks the implementation of CLM by automating key tasks, reducing manual intervention, and improving compliance to prove benefits rapidly, within the first year.

This approach accelerates the realization of CLM benefits within the project lifecycle by enabling the automation of data and document retrieval to run alongside other CLM activities.

Accelerate your CLM journey with CDI

Are you embarking on a CLM journey and looking to accelerate the benefits as well as de-risk the project? Learn how integrating CDI can help your bank streamline KYC and improve compliance in the short term, while accelerating digital transformation and future proofing new operating models.

Reach out to Encompass to explore how CDI can revolutionize your client lifecycle management today.