We are considering starting online account opening. We are a low risk, small bank. What risks should I be aware of? What types of things have your banks put in place?

The first question is how will non-documentary ID verification be completed? If you're using a vendor, how comfortable are you with their data sources? Besides CIP information, what CDD information will be requested? How will you handle accounts where the CIP or CDD information cannot be verified automatically? There are other questions to be answered but these are the ones I would focus on first.

Do you have restrictions as far as who can open the account? Only existing customers or new also? If new, are there restrictions for location - such as only in your state? Personal accounts only or businesses also?

We would never let a business open an account online as our provider cannot verify their organizational documentation automatically. Initially we began with the states we operate in but once we thought the program could handle it, we expanded. There is a significant fraud risk with online account opening as well and that's something you should consider as well.

This is an important distinction. Opening a relationship is a much higher risk than opening a new account within an existing relationship.

You might want to limit the types of accounts that can be opened online.