Australia's largest banks have thrown their weight behind the concept of a shared industry "utility" for customer identification and verification, with the primary goal of streamlining and improving the customer onboarding experience. The banks' support for a know-your-customer (KYC) utility represents a sea change in the sector, with financial services firms traditionally seeing customer onboarding as a source of competitive advantage. Senior anti-money laundering practitioners said there was a growing awareness at board level that collaborating on customer onboarding would help to prevent financial crime, reduce costs and benefit the sector as a whole.The utility approach to KYC aims to pool industry resources and expertise to create a more secure, cost-effective and "frictionless" customer onboarding model, particularly for corporate customers. The moves toward collaboration have been welcomed by the Australian anti-money laundering regulator, which said technology and public-private partnerships had a vital role to play in fighting financial crime and improving AML/CTF compliance. The concept of a KYC utility has been gaining traction in Australia as reporting entities look at ways to streamline and automate parts of their onboarding processes. Some of the country's leading money laundering reporting officers (MLROs) said the banks had recognised that there was little to be gained from competing against each other in the area of KYC compliance."The industry has changed over the last few years. In the past there was a bit of a perception that you could use your onboarding process as a competitive advantage. I think the industry has matured now to the point where that's not where we see our competitive advantage lying," said Adam Clark, general manager of client services for institutional banking at National Australia Bank.Guy Boyd, head of financial crime at ANZ, said there were significant economies of scale that could be achieved if banks collaborated. Maintaining a positive customer experience should be one of the primary goals of any industry-wide KYC solution, he said. "We have to be aware of multi-banked customer segments and the fact that they will have different experiences, perhaps better or worse at different institutions. There's a lot of frustration out there in the market that they're getting asked for the same thing time and time again," Boyd said. "We continue to be engaged in asking, 'how do we achieve the same or better outcome more efficiently?'," he said.Macquarie Bank is also examining ways to improve the KYC process, particularly in relation to corporate customers. Scott Saunders, director of risk management at Macquarie, said banks had realised there was plenty to be gained from a collaborative approach to KYC. It made little sense for different banks to be asking customers for the same basic identity information when this could be provided once and uploaded to a secure shared utility, he said."The competitive advantage is not in the collection of the data and the recording of the data, it's in the evaluation of the data. That's the proprietary part of the onboarding process. It's not where you get information from, it's how you evaluate