Due diligence is a HUGE cost center for most banks, and the stats show it ⤵
An interesting stat I came across: 60% of commercial banks spend over 33% of their compliance budgets on KYC. For 20% of banks, this number jumps up to 50%. Fintechs and banks are spending HUGE portions of their compliance budgets on doing due diligence on businesses and customers. This just goes to show that: 1/ Due diligence is extremely important. 2/ It’s a huge cost center. At Accend (YC S23), our job is to streamline business onboarding and enhance compliance — and so for us, it makes sense to focus on the most important and fundamental task at hand: due diligence. This is existential to a financial institution’s presence. Because if you onboard customers without doing due diligence, guess what happens? You get into trouble, your customers will lose trust, and you'll have less revenue. And nobody wants that.