HCLTech Solves ‘Know Your Customer’ for European Bank

During HCLTech’s Financial Services Advisor and Analyst Day in New York City this past August, the vendor described an engagement with a European bank in which HCLTech provided a comprehensive Know Your Customer (KYC) solution. TBR requested further details and met with HCLTech leaders responsible for the solution and the vendor’s European Financial Services practice in September in London.

HCLTech has a long history of working with banks and has developed an appreciation for the associated challenges, technology environments, and regulatory and compliance demands, in addition to the full stack of ecosystem partners. Additionally, HCLTech understands financial institutions’ KYC risks and has applied the company’s own investment and IP to address clients’ concerns around data and processes.


Over the last couple of years, HCLTech created a comprehensive approach to KYC for a European bank, solving a number of the bank’s operational challenges, including collating siloed processes and gathering related and dependent data and analytics into a single stream, allowing the CIO to see and understand the technology challenges and bringing greater confidence in controls and reporting to the chief compliance and risk officer.


Having engaged this and other financial services clients, HCLTech leaders described the company as the “glue” between IT and risk and compliance. Critically, HCLTech’s leaders said their professionals on the highlighted engagement spoke extensively with the people handling the day-to-day work of analyzing KYC cases.

According to Santosh Kumar, Vice President and Head of Financial Services Solutions, EMEA and APAC, no other IT services vendor has received permission from — or even pressed for permission from — bank CIOs to interview and work with them around designing a technology solution that meets the needs of the banks’ KYC analysts, professionals that Santosh stated are frequently considered necessary cost centers within a bank’s operations.


Diving further into the use case, Abhishek Mishra, Senior Solutions Director, Financial Crime and KYC, HCLTech, first detailed the pain points and trends HCLTech sees across the financial services space, including false positive rates, compliance costs, cloud migration and enhanced data analytics.


Against these conditions, according to Mishra, HCLTech positions itself as “the beacon of trust and innovation in the ever-evolving landscape of financial crime prevention” and a vendor capable of empowering “organizations worldwide to safeguard their integrity and financial stability.” Against that aspiration, HCLTech highlighted the company’s resilience and experience, enhanced by technologies, particularly smart automation.


Further discussing HCLTech’s decision to engage directly with the KYC analysts, Mishra described how he sees a range of KYC issues that are not always apparent at the CIO or chief compliance officer level, including fragmented IT systems and frequent manual interventions into processes that should be standardized and automated.


Using the platform codeveloped with the European bank client, HCLTech helped the bank reduce its operations team by 60% and lowered the incidence rate of false positives by 30%. As Mishra noted, the industry standard incidence rate for false positives is around 90%, making any improvement a substantial savings in operations costs. Overall, the breadth and proven depth of HCLTech’s capabilities across the KYC and broader financial services space struck TBR as potentially significant differentiators as IT services vendors face increased pressures on their margins, talent management strategies and business models.

The “glue” between IT and risk and compliance

It is a bold claim, and plenty of consultancies, many IT services and even some technology vendors would self-describe as the essential connection between functional groups within an enterprise. HCLTech’s claim, in this particular case about KYC, holds greater weight based on the thorough — and fully operational — nature of its KYC platform.


In a wide-ranging discussion with TBR on this use case, HCLTech’s Mishra and Santosh did not shy away from answering several challenging questions, including why banking clients would trust HCLTech with as material a requirement as KYC as well as how HCLTech interacts with the regulators.


HCLTech executives showed a refreshingly honest assessment of the company’s place in the ecosystem, acknowledging that the Big Four firms continue to play an essential role in providing assurance to both clients and regulators that HCLTech’s KYC approach — and other banking process technologies — meet all criteria for reliability and compliance. Mishra and Santosh also readily acknowledged that the company’s role within the ecosystem depended on niche technology vendors, rejecting the idea that HCLTech was “end-to-end” while embracing the need to be a capable and easy-to-work-with ecosystem partner.


In addition to recognizing challenges within the ecosystem, HCLTech acknowledged that not every client would or could adopt the company’s KYC solution, given the complexities of banks’ legacy technology environments, ingrained cultural dispositions toward caution around all operational aspects governed by compliance obligations, and the myriad technology and IT services vendors that are scrambling for a chance to sell the next special tech-infused solution to a bank (hearing thunderous echoes here of generative AI).


Rather than pressing forward on a one-size-fits-all solution, HCLTech has created sandboxes for banks to experiment with a test solution, including the KYC platform, in safe — but realistic — environments. HCLTech’s well-established credibility among financial services clients unquestionably provides the company with entry to advise on new approaches to solving persistent problems.

Financial crimes will not disappear, but HCLTech could ease banks’ costs

In TBR’s view, offering new ways to solve persistent problems is precisely how HCLTech has tackled KYC. Banks budget a surprisingly substantial amount of their operational costs toward KYC, including funds dedicated specifically to paying fines if (read: when) they are found to be out of compliance.


In its European bank use case, HCLTech helped the client reduce its number of FTEs dedicated to KYC by 60% and also delivered an auditable, comprehensive and technology-enabled platform that the bank owns, operates and depends on. KYC challenges will never disappear: Money launderers — perhaps Venice’s second-oldest creation — will always be more creative than governments, banks and technology companies. But if HCLTech can substantially reduce banks’ KYC costs without compromising compliance, it is going to unlock considerable value for banks to invest in additional services, technologies and transformations.


TBR believes the keys to HCLTech’s success in KYC include:

  • Continuing to focus on being the “glue” between risk and compliance and IT: HCLTech has established credibility with the latter and has grown its credibility with the former, but both will remain essential to KYC transformation. Sticking to its comfort zone with technologists will limit HCLTech’s ability to scale a KYC solution.
  • Staying within its swim lane: Although it is contradictory to the point above, HCLTech should focus on delivering comprehensive and highly functional solutions, in sync with the company’s engineering DNA. HCLTech executives’ willingness during the conversation to cede consulting territory to the Big Four firms (notably EY) struck TBR as exceptionally self-aware in assessing HCLTech’s role in the broader banking ecosystem.
  • Remaining patient: TBR has been briefed on countless transformational solutions that are ready to address burdensome costs with bullet-proof technology. And TBR has heard specific transformational use cases cited … but often three, four or five years later, raising the question: “If that solution was so great, why didn’t it scale?”

HCLTech may have something great here. With patience, discipline around partnering, and a focus on collaboration with the right clients in the right setting at the right time, HCLTech’s KYC solution could become a materially significant step forward in banks’ operational costs and also a good thing for society when it comes to combating fraud and financial crimes.


Operators Target Emerging 5G Use Cases, but Monetization Will Remain a Challenge

Approximately 100 industry analysts in addition to representatives from well-known telecom operators and vendors convened at the 2023 5G Americas Analyst Forum to discuss the state of the 5G market in North America and Latin America. The event featured keynotes from Ulf Ewaldsson, president of Technology at T-Mobile, and Scott Blake Harris, senior spectrum advisor at the National Telecommunications and Information Administration’s Office of the Assistant Secretary. The event also featured a series of roundtable discussions focused on key topics in areas including 5G network infrastructure and technologies, private cellular networks, multi-access edge computing, IoT, regulatory considerations, and enterprise and consumer 5G use cases.

TBR Perspective

The 2023 5G Americas Analyst Forum highlighted that 5G development in the U.S. is in its middle stages as operators are on track to complete the bulk of their midband 5G spectrum deployments in 2024. The return on investment for 5G remains unclear, especially for Verizon (NYSE: VZ) and AT&T (NYSE: T) due to their heavy investment to acquire C-Band spectrum licenses.
Operators remain challenged in monetizing 5G because use cases, with the exception of fixed wireless access (FWA), are still limited, especially within the consumer market as LTE remains sufficient to support current smartphone apps in most instances. Conversely, revenue generation for enterprise 5G use cases in areas including private cellular networks (PCNs) and multi-access edge computing (MEC) is taking longer than anticipated as many clients are postponing implementing these solutions until business cases and benefits become more certain.

Despite current challenges in monetizing 5G, investments in the technology remain necessary for U.S. operators to remain competitive with each other, to add network capacity to support rapidly growing data traffic, and to gain network efficiencies and cost savings as 5G is significantly better at handling network traffic compared to LTE. Additionally, new technology standards, including 3rd Generation Partnership Project (3GPP) Releases 16 and 17, are helping to unlock the potential of 5G solutions in areas including MEC, network slicing, industrial IoT and V2X (vehicle-to-everything) while the upcoming 3GPP Release 18 will debut 5G Advanced technology. Though the availability of these technologies will create 5G monetization opportunities, TBR expects hyperscalers, application developers, OEMs and other players within the technology industry to capture the majority of new revenue from 5G-related solutions, while operators will serve mainly as connectivity pipes to support these solutions.

Click to register for our next private 5G TBR Insights Live event!

Impacts and Opportunities

5G Adoption Is Accelerating in North America, but Revenue Generation Remains Minimal

Though North America leads other regions in the adoption of 5G-compatible devices and enrollment in service plans, direct revenue generation for operators from smartphone customers is limited due to minimal use cases besides providing faster data speeds. TBR believes operators are monetizing 5G in indirect ways, however, including by helping to ensure strong quality of mobile broadband service to minimize churn and by leveraging enhanced network capacity to support features exclusive to higher-tier service plans such as increased high-speed mobile hotspot data limits before speeds are throttled as well as increased data tiers for mobile hotspot coverage. Certain operators, most notably Verizon, are also limiting access to midband 5G services to customers enrolled in premium service plans.

FWA currently provides the most significant 5G revenue opportunity for operators, as evidenced by T-Mobile’s (Nasdaq: TMUS) and Verizon’s FWA services outperforming cablecos and other broadband providers in broadband subscriber growth in recent quarters. Government initiatives will also help to further FWA customer adoption and service availability, including via broadband funding programs as well as through financial assistance programs, such as Metro by T-Mobile offering discounted FWA pricing via the government’s Affordable Connectivity Program. However, TBR believes FWA will hinder revenue generation long-term when considering the entirety of the broadband industry due to the lower price points of FWA as well as most FWA customer additions stemming from share shifting from other broadband providers. FWA will also result in “race to the bottom” pricing as cablecos and other broadband providers will likely become more competitive in their pricing in the long term to attract and retain customers.

A National Spectrum Strategy Is Vital to Support 5G Long-term While Creating a Foundation for 6G

Scott Blake Harris discussed the National Spectrum Strategy, an initiative headed by the U.S. Department of Commerce, NTIA and other federal agencies, including the Federal Communications Commission (FCC), to address the long-term spectrum requirements within both the public and the private sectors. The National Spectrum Strategy is expected to be finalized by the end of 2023 and is focused on creating a pipeline to enable the U.S. to maintain its leadership in spectrum-based technologies, ensure long-term spectrum planning in the U.S., and foster unprecedented spectrum access and management through technology development. A key priority of the National Spectrum Strategy is to improve communications between government agencies and the private sector and to identify and evaluate 1500MHz of spectrum in the U.S. that could be repurposed based on the requirements of both sectors over the next decade.

The clearance of additional spectrum will be essential for U.S. operators to support rising 5G traffic long-term while helping the U.S. to compete at the forefront of 5G development against other leading countries such as China. TBR believes the National Spectrum Strategy may be facing resistance, however, from federal entities hesitant to clear certain spectrum to the private sector as the CTIA reports the U.S. government controls 600% more midband spectrum than the commercial U.S. wireless industry. For instance, the Department of Defense has expressed reservations about clearing certain spectrum, such as within the 3.1GHz -3.45GHz range, due to national security concerns as the spectrum currently helps to support military infrastructure including defense systems.

Revenue Generation from Enterprise 5G Use Cases Will be Limited for Operators as Other Players Within the Technology Industry Position to Capitalize on These Solutions

Keynotes and roundtables throughout the event discussed the benefits 3GPP Releases 16-18 will provide to support 5G-related network capabilities and use cases.
The technology advancements provided by these releases will help to advance the development of 5G enterprise use cases in areas including MEC, PCN and IoT. However, hyperscalers, OEMs and other players in the telecom ecosystem are also making headway in these areas, which is causing operators to share revenue from these solutions in many cases and to be circumvented altogether in other instances.

For instance, AT&T’s, T-Mobile’s and Verizon’s go-to-market strategies for MEC have centered on leveraging hyperscalers’ partnerships to accommodate client demand for Amazon Web Services (AWS) (Nasdaq: AMZN), Google Cloud (Nasdaq: GOOGL) and Microsoft Azure Nasdaq: MSFT) solutions. In many cases, clients are opting to work directly with hyperscalers and OEMs in PCN, circumventing operators altogether.

Network slicing is another emerging 5G use case discussed throughout the event that is beginning to gain traction. T-Mobile is positioning to be an early leader in network slicing due to its time-to-market advantage in deploying 5G standalone nationwide. The operator recently launched its 5G networking slicing beta program nationwide, which is initially targeting developers seeking to leverage the technology to enhance video calling applications, and T-Mobile will expand the platform to support additional applications and use cases in the future.

Initial companies exploring the platform include Dialpad Ai, Google, Cisco and Zoom. TBR expects operators will monetize network slices by providing specialized pricing tiers to optimize coverage and service quality for certain use cases and applications, though in most instances developers and other players will be the entities that will generate the lion’s share of new revenue from these use cases. TBR expects the scenario will be similar to the LTE era, in which operators served mainly as the connectivity pipes for new applications in areas such as ride-hailing and video streaming but other players captured nearly all of the new revenue.

Leveraging satellite connectivity to support mobile customers was another emerging use case discussed at the event. Satellite connectivity is gaining headway through new 3GPP standards releases and recent partnerships such as T-Mobile teaming with SpaceX, Verizon partnering with Amazon’s Project Kuiper, and Apple (Nasdaq: AAPL) collaborating with Globalstar. Satellite connectivity is initially being leveraged by operators to support emergency SOS texting services in remote areas without cellular coverage, though satellites will be leveraged to support more advanced voice and data capabilities in the future. Though partnerships between operators and satellite providers are promoted as being mutually beneficial for both parties, opportunity exists for significant market disruption in the long term if satellite providers decide to target nationwide satellite-based smartphone service directly to consumers once technology capabilities advance and a sufficient number of satellites have been deployed.


The 2023 5G Americas Analyst Forum highlighted the progress operators have made in deploying their 5G networks, especially regarding deploying midband 5G services. This progress, coupled with advancing 3GPP technology standards, provides operators with a foundation to target emerging use cases, especially within the enterprise space. Operators will be challenged, however, in sufficiently monetizing these use cases to generate a viable return on investment that offsets heavy 5G spectrum acquisition and infrastructure deployment costs.

Arm-based PC Chips and AI LLMs: Expected Implications for PCs in 2024

Join Senior Analyst Ben Carbonneau, Research Analyst Alek Maxfield and Principal Analyst Ezra Gottheil Thursday, Nov. 30, 2023, at 1 p.m. EST/10 a.m. PST for a 30-minute live discussion and Q&A on the latest developments in AI large language models (LLMs) for PCs, including a deep dive into Microsoft Copilot, which is slated for general availability in November 2023. This update will build on the AI PC trends and predictions introduced during TBR’s last devices-focused Insights Live event (view now).


Additionally, the team will discuss reports that NVIDIA and AMD are working on separate ventures to create Arm-based PC chips to power Windows machines. Traditionally, most Windows-based PCs have run on x64 or x86 processors manufactured by Intel and AMD. And while Arm-based PCs have been brought to market over the years, these machines lacked in general functionality. And TBR’s expectations for success of these ventures and the impact on the PC market as a whole.

In This FREE Session on Arm-based Chips and AI LLMs You’ll Learn:

  • Expectations for the PC market in 2024, including how gradually shifting undercurrents will effect the market
  • TBR’s view on Arm-based PC systems on a chip and their impact on the future of the PC market
  • Update on AI PC trends and predictions discussed in previous TBR Insights Live session



TBR webinars are held typically on Thursdays at 1 p.m. ET and include a 15-minute Q&A session following the main presentation. Previous webinars can be viewed anytime on TBR’s Webinar Portal.

For additional information or to arrange a briefing with our analysts, please contact TBR at [email protected].


Strategic Synergy: Maximizing Technology Alliances in the Ever-Changing IT Landscape

In a recent deep dive for a consulting client, TBR contacted three of the client’s technology partners to get a sense of what they thought about our client and the client’s immediate peers. We spoke with people who were very familiar with the alliance with our client, and we asked:

  • Who managed the alliance relationship?
  • Who decided when to bring our client in on an engagement and under what criteria?
  • What did these technology companies think about our client’s ability to innovate and drive new business?

Prior to these conversations, we examined use cases and thought leadership pieces and analyzed what we knew about the three tech companies’ financial performance. We even spoke with customers who engaged our client and the client’s technology partners. The findings reinforced the fundamental elements of a good alliance: know your partner, respect your roles, and make the customer’s needs the center of everything you do together.

That’s not to say that we didn’t hear some new and nuanced responses. Among the critical lessons learned: If your partner’s sales people cannot explain what makes you special, you’re losing opportunities. Partners are not obligated or incented to build that knowledge. If you want them to be able to articulate your value proposition, your alliance relationship needs to include training, training and additional training. You cannot believe anyone in your own organization when they say, “Yeah, those guys know us.” You need to ask your partners yourself, at the client-facing level.
Download 'Cloud Ecosystem Success: How to Stand Out with the Right Global Systems Integrator

The Key to Strategic Alliances Lies in a Comprehensive Grasp of Partner Capabilities, Priorities and Incentives

Let’s build on this idea of really knowing your role and your alliance partners’ capabilities. In this messy, evolving ecosystem, as you’re being smart and clearly defining roles among alliance partners engaged with strategic clients, you’re going to run into one of the most vexing challenges seemingly every company faces: understanding what someone else does.


Internally, most companies tackle this through knowledge management, an almost always underfunded effort to ensure that employees know what other employees do and that everyone can articulate the company’s mission, capabilities and offerings. The reasons why most knowledge management efforts underwhelm are vast, but the short version comes down to lack of leadership, funding, curating and consequences.


In today’s IT ecosystem, vendors absolutely must ensure their mission, capabilities and offerings are well understood by their ecosystem partners. Similar companies have developed stark differences, and every company is spreading into adjacent swim lanes. If you don’t know what your ecosystem partners do, you’re going to underwhelm them (and be forgotten) or realize too late that they’ve been taking your money off the table. It’s almost impossible to overstate how critical a comprehensive understanding of your ecosystem partners’ capabilities, priorities and even incentives is to fully leveraging alliances.

Educating for Success: Elevating Partnerships Through Comprehensive Knowledge Sharing and Strategic Alignment in the Dynamic Technology Ecosystem

They need to keep you up to speed on all their speeds and feeds. In our research, the vendors that are dedicating resources to educating their ecosystem partners on developing portfolios, new offerings and changes in market perceptions and opportunities outperform peers and the IT market as a whole. Your sales people can’t be the only ones who understand your capabilities because they aren’t always the people who are in front of your clients. When your partners’ sales people are selling you, how well do they sell?


Everyone gets wrapped up in their own world, and we’re often advising our clients to stay in their own lane and do what they do well. As the technology ecosystem evolves, that’s not enough. Now companies need to be absolutely certain an understanding of their business model and value proposition extends to their alliance partners. As they say, the more you know!