Exploring an Industry-Wide Standard to Customer Risk Assessment – Proposing a Best Practice Model for Banks

Farokh Keki Adarian CAMS-Audit, MBA (Banking); CFCS, ICA Prof.Pg Dip (FCC); Int.Dip (GRC); FICA Certified Professional

This white paper intention is to provide the challenges faced in proposing an industry-wide risk assessment model. While consistent with the basic tenets of the RBA, this paper explores the concept of “harmonization,” in order to present a conceptual and harmonized customer risk assessment model for banks. As opposed to process “standardization,” which in its strict sense seeks to achieve uniformity of process activities (i.e., aims at only one uniform, global standard), process “harmonization” seeks to align similar process activities based on a single, focused business objective, while recognizing that some mandatory differences (process variants) may be essential and will remain. The harmonization of laws in the EU member states, is one such empirical example.

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