Client impact reduced through NVB Risk-based Industry Baselines

It will become easier for bona fide clients to open a bank account, and they will be less likely to face many personal questions from their banks. At the same time, banks will continue to make it difficult for criminals to abuse the financial system. That is the main outcome of the series of roundtable discussions between banks and the Dutch Central Bank (DNB) on more risk-based client due diligence to prevent money laundering. The Dutch Banking Association (NVB) is starting by publishing five Industry Baselines that set out clear principles for banks to perform their gatekeeper obligations proportionately whilst focusing on the real risks.

Reduced client impact

A concrete example of the new NVB Industry Baselines where bona fide clients no longer have to answer questions is a situation in which they conduct transactions with EC  high risk third countries. With the new NVB Industry Baseline, if someone goes on holiday to such a country and their spending remains in line with what is expected from an ordinary tourist, there is no longer need for probing questions or restrictive measures.

Another example of reduced client impact is identifying and verifying the UBO, a company’s ultimate beneficial owner. For low and neutral risk scenarios, the new Industry Baseline allows  banks to use the data in the UBO register and only request confirmation from te client. For example, business clients will no longer have to provide this information to the bank through a UBO statement. The NVB Industry Baselines make banks less likely to inconvenience their clients in low- or neutral-risk scenarios. That allows bank employees to focus their attention on the real risks. More where necessary, less where possible!


Sector Industry Baselines

The NVB will publish around 12 more Industry Baselines in due course, whereby special attention will be paid to entrepreneurs in high-risk sectors who often face hurdles in accessing the financial syste, due to banks’ intensive client due diligence. Specific Sector Industry Baselines are therefore being developed with the relevant sector associations, DNB and the Ministry of Finance. Aim is to determine what the real risks are in those specific sectors so that banks’ client due diligence can be targeted accordingly. The NVB hopes to publish new Industry Baselines for not-for-profit organisations, sex workers and crypto businesses in the next few months. Industry Baselines for cannabis cafes, automotive companies, payment institutions and retail (among others) are expected to follow later.