As financial crime rises and regulatory scrutiny tightens, organizations are ramping up compliance spending—but remain divided on whether AI is the right solution for Know Your Customer Enhanced Due Diligence (KYC EDD), according to a global survey by LSEG Risk Intelligence.
The survey revealed that 87% of risk and compliance professionals expect their organization’s KYC EDD budgets to increase over the next 12 months, with an average projected rise of 5.2%. Currently, the average annual EDD spend stands at $632,026, climbing to over $900,000 for companies with revenues exceeding $1 billion.
Growing Compliance Demand
The demand for compliance checks has surged, with 90% of respondents noting an increase in requests over the past three years. As teams explore technology solutions to manage this workload, opinions on AI’s effectiveness are split.
- 58% of professionals believe KYC EDD should remain mostly or fully human-driven.
- 42% advocate for full or partial AI automation.
Balancing AI and Human Oversight
Daniel Hartnett, Head of Enhanced Due Diligence at LSEG Risk Intelligence, emphasized a balanced approach:
“While AI offers core benefits in EDD, it must be implemented safely and responsibly, with human oversight. A purely automated approach could introduce more risk rather than mitigate it.”
As organizations navigate the balance between cost control, compliance quality, and operational efficiency, the debate over AI’s role in compliance management is set to continue.
