How blockchain technology can help manage the client lifecycle and KYC

How blockchain technology can help manage the client lifecycle and KYC

Ajit Tharaken,

At PegaWorld 2018 we announced the launch of the Pega Blockchain Innovation Kit as well as our first Pega Client Lifecycle Management™ (CLM) and Pega Know Your Customer™ (KYC) business use case built on top of it. Available for download today, the kit provides a proof of concept template for banks to test how Pega CLM and Pega KYC can use the Ethereum blockchain within the overall client onboarding process.

What is blockchain?

Blockchain is a relatively new technology that has attracted a lot of interest in the Financial Services sector recently. It is a form of distributed ledger that provides a vehicle for the secure, immutable exchange of data in a sequential manner using encryption key technology to drive controls, auditability, and transparency. In simple terms, blockchain functionality enables the secure and visible exchange of data among permissioned parties through the use of encryption keys. That’s why blockchain is used to form the foundation for cryptocurrency and is viewed across the industry as one of the fundamental emerging technologies that will transform the financial services industry.

How financial institutions can leverage Pega blockchain to improve CLM & KYC

Blockchain’s benefits include increased security, collaboration, and cost savings, which is why a number of use cases have emerged in the Financial Services industry – the front runners include cross border transactions, payments, trade finance, clearing and settlements, smart contracts, CLM, and KYC.

Banks spend billions of dollars managing due diligence compliance on new and existing customers against evolving KYC regulations designed to curb regulatory risk, terrorist financing, and money laundering. Blockchain can help financial institutions share this burden and eliminate duplicate efforts by vetting customers in a shared distributed ledger.

The Pega blockchain self-governing and immutable model is extremely useful when applied to the overall orchestration of customer onboarding processes. With advanced cryptography, data immutability, and transparency, blockchain reassures banks that the records are secure, consistent, and accurate, and helps ensure the data is there for parties that need to see and use it. In this way, blockchain provides an effective and secure way to extend enterprise applications beyond traditional boundaries and into a distributed ecosystem.

Pega’s Blockchain Innovation Kit

The Pega Blockchain Innovation Kit provides a safe, non-invasive way for Pega clients to integrate their Pega CLM and KYC onboarding software and Ethereum, one of the predominant blockchain technologies. The integration of Pega CLM and KYC with Ethereum Blockchain allows for the secure exchange of compliance information. The kit comes with a predefined Smart Contract that governs how clients can read from and write to the blockchain.

A major benefit for Pega CLM and KYC clients is the reduction or even elimination of having to reach out to their customers, leading to a better overall customer experience. By allowing the customer to be the owner of their compliance profile, data privacy and security issues are inherently adhered to. The portion of the compliance record data and documents that gets shared is common across banks, and each bank is able to use that shared data to generate their unique risk profile on the customer. Meaning, it allows banks to adhere to their own internal risk policies while still using shared supporting customer’s compliance information.

Blockchain can play an important part in digital transformation

Digital transformation is about using technology to improve the systems and processes that help organizations best serve their customers – removing friction and streamlining the way work gets done. This is one of blockchain’s strengths. Blockchain augments an organization’s ability to automate work, verify data, and provide detailed tracking of that data. When used within an enterprise ecosystem and in conjunction with digital process automation (DPA), blockchain can bring new levels of efficiency in client outreach.

At PegaWorld, Alan Trefler, founder and CEO of Pegasystems, explained our company’s specific point of view on blockchain as a tool for digital transformation, customer engagement, and operational excellence: “As the breathless hype around blockchain continues to escalate, many organizations are jumping on the bandwagon without first knowing what real business problems they want it to help solve. Pega has decades of leadership in digital process automation, putting us in a prime position to identify the best enterprise use cases for blockchain that will drive real results. Our Blockchain Innovation Kit will help our clients explore blockchain as a new piece to their digital strategy, as well as understand the critical role Pega can play in unlocking its value.”

Learn more:


  • Industry Group: Servizi finanziari
  • Argomento: Eccellenza operativa
  • Argomento: Pega Platform
  • Argomento: Gestione dei casi
  • Argomento: Servizio clienti
  • Sfida: Registrazione clienti
  • Area prodotto: Registrazione

About the Author

In his role as Senior Director and Industry Principal for Client Lifecycle Management, KYC, and Digital Automation at Pega, Ajit Tharaken helps clients accelerate digital transformation and transform the client lifecycle.