Abstract :

The Know-Your-Customer (KYC) onboarding component in the customer acquisition process became an issue in an Indonesian branch of a prominent global bank. In 2023, the branch received a significant complaint from one of its major clients, noting the inefficiency of its KYC onboarding process, thus garnering attention from local senior management. From 2019 to 2023, there was a steady increase in client dissatisfaction rate and the number of new clients dropping their requests during the KYC onboarding stage. This research aims to identify the pain points in Magnolia Bank’s KYC onboarding process and propose solutions using the Business Process Re-engineering (BPR) approach. Fifteen respondents, including 10 bank employees and 5 corporate clients, were interviewed. Thematic analysis of interview results was conducted and it revealed three major pain points of the process: difficulty in document submission, challenges in requirements, and communication issues. The root cause of these pain points were then analyzed using the fishbone diagram, from which three root causes were discovered: inadequate technology infrastructure, lack of transparency in the process, and insufficient guidance that clients receive from the bank. The BPR approach was taken to fix the problems, the project focused on improving the guidance to clients, enhancing technology infrastructure, and developing a system for clients to track their onboarding progress. The proposed business solution for this research is for Magnolia Bank to develop a dedicated KYC onboarding platform, allowing prospective clients to submit the requirements directly, experience a one-window communication system, and track their KYC onboarding status.

---

Keywords :

Business Process Re-engineering, Customer Acquisition, KYC, KYC Onboarding Platform, Technology Enhancement.

---

References :

1. Arner, D. W., Barberis, J. N., & Buckley, R. P. (2015). The evolution of fintech: A new post-crisis paradigm? Georgetown Journal of International Law, 47(4), 1271-1320.
2. Basel Committee on Banking Supervision. (2016). Sound management of risks related to money laundering and financing of terrorism. Bank for International Settlements. Retrieved from https://www.bis.org/bcbs/publ/d405.htm
3. Al-Tamimi, H. A. H. (2015). Risk management practices: An empirical analysis of the UAE commercial banks. Finance India, 29(1), 67-89
4. Hammer, M., & Champy, J. (1993). Reengineering the Corporation: A Manifesto for Business Revolution. Harper Business.
5. Setegn, S. G., Lakew, D., & Bewket, W. (2013). Business process reengineering in the public sector: The case of Ethiopian public organizations. African Journal of Business Management, 7(5), 1224-1234. https://doi.org/10.5897/AJBM11.2334
6. Bhaskar, H. L. (2014). Business process reengineering: A process-based management tool. Serbian Journal of Management, 9(1), 63-87. https://doi.org/10.5937/sjm13-13188
7. Motwani, J., Kumar, A., Jiang, J., & Youssef, M. A. (1998). Business process reengineering: A theoretical framework and an integrated model. International Journal of Operations & Production Management, 18(9-10):964-977
8. Hussein, B., Chouman, M., & Dayekh, A. (2014). A project life cycle (PLC) based approach for effective business process re-engineering. Industrial Engineering Letters, 4(6).
9. Miles, M. B., Huberman, A. M., & Saldana, J. (2014). Quality data analysis: a method sourcebook (3rd ed.). SAGE.
10. Maister, D. H. (1984). The psychology of waiting lines. Harvard Business School.
11. Nunkoo, R., Teeroovengadum, V., Ringle, C. M., & Sunnassee, V. (2020). Service quality and customer satisfaction: The moderating effects of hotel star rating. International Journal of Hospitality Management, 91, 102414. https://doi.org/10.1016/j.ijhm.2019.102414

12. Imran, A., Maqbool, H., & Shafique, S. (2014). Impact of technological advancement on employee performance in banking sector. International Journal of Human Resource Studies, 4(1), 71-80. https://doi.org/10.5296/ijhrs.v4i1.5620
13. Malterud, K. (2001). Qualitative research: Standards, challenges, and guidelines. The Lancet, 358(9280), 483-488. https://doi.org/10.1016/S0140-6736(01)05627-6
14. Braun, V., & Clarke, V. (2006). Using thematic analysis in psychology. Qualitative Research in Psychology, 3(2), 77-101. https://doi.org/10.1191/1478088706qp063oa
15. Creswell, J. (2014). Research design: Qualitative, quantitative, and mixed methods approaches (4th ed.). SAGE.
16. Lincoln, Y. S., & Guba, E. G. (1985). Naturalistic inquiry. SAGE.
17. Terrell, S. R. (2016). Writing a Proposal for Your Dissertation: Guidelines and Examples. Guilford Press.
18. Wilson, P. F., Dell, L. D., & Anderson, G. F. (1993). Root Cause Analysis: A Tool for Total Quality Management. ASQ Quality Press.