Among the many things that surprised the outside world in the wake of the banking crisis was that banks couldn't readily say what each customer's position with them was: details of different accounts were (and are) scattered around different systems, sometimes in different subsidiaries.

As banks failed - particularly the Icelandic ones – the public was being made aware of its rights under the Financial Services Compensation Scheme and the limits thereon: €50,000 per bank - not per account. HSBC and First Direct, for instance, count as one bank for the purposes of the FSCS as they share a banking license.

The regulatory response was to force banks to create a single customer view, requiring all UK insurers, building societies and retail and investment banks to create and maintain an accurate view of each customer. The first reporting deadline was 31 July 2010, and full compliance must be achieved by 1 January 2011.

A recent survey, commissioned by data management specialist DataFlux and conducted by research house JWG, reflects the responses of individuals in the financial services industry that are responsible for the data in their respective companies, looking at the 800 or so deposit holding institutions in the UK to which the FSCS reform applies.

The survey found that 50% of respondent firms only began the significant undertaking to develop an SCV during this year - the year in which projects must be delivered. Just 59% of respondents had heard of the requirement for single customer view, with a "significant percentage (41%) unaware of their regulatory obligations". In addition, 28% of respondents could not identify who owned the SCV within their organisation.

When respondents were asked about the consequences they expected to face if their institution failed to meet the FSCS SCV deadline of 1 January 2011, the majority (65%) believed they would incur a financial penalty which could be millions of pounds. In addition, 74% of respondents felt that a failure to meet the deadline would lead to greater scrutiny from the regulator and one-third believed their firm would be at a competitive disadvantage.

When investigating the barriers to compliance, four key areas were identified: a lack of business commitment, a lack of resources, poor-quality data and a lack of guidance. In addition, data-related issues were viewed as the most challenging to overcome, with poor-quality legacy data and data quality management earning a ‘difficult' rating. Respondents also cited a lack of guidance from the regulator as a barrier to compliance.

Respondents said an SCV benefited a variety of business functions, such as the back office (80%), the risk management department (64%) and the revenue generating departments (40%). However, only 14% saw an SCV project as a strategic opportunity to deliver benefits above and beyond compliance. Since an SCV program can also dramatically improve an organisation's understanding of the customer for marketing and support purposes, the remaining 86% of respondents could miss a vital opportunity to improve customer-facing processes and enhance lifetime customer value.

Colin Rickard, managing director EMEA, DataFlux, said: "This report highlights a shortfall in spending required to create SCVs in order to meet the FSCS requirement for January 2011. This will have to be corrected in the second half of 2010 or firms risk facing significant fines and further reputational damage during 2011. It is clear that data quality and data integration are key compliance challenges. We are working with leading financial services firms to create and validate SCVs across the industry."

PJ Di Giammarino, founder and chief executive of JWG, added: "The customer data issue isn't going away anytime soon. Accurate customer data is critical to the regulatory tsunami as it is fundamental to controlling risk, protecting customers and spotting market abuse."

Di Giammarino points out that "five high profile firms have recently been fined a total of £7.3 million by the FSA in relation to data errors. The survey findings suggest there will be significant penalties for those companies that neglect the development of a single customer view."

Perhaps not surprisingly, Rickard says that there are challenges for IT in meeting the requirements of the legislation, but he says that it is "primarily a business issue" in that it requires commitment from the business side to address it. "A lot of this is business rules driven, but you can't do it without data quality and data management tools," he said. "If it was just a question of supplying the data, it would be difficult, but validating the content is going to be crucial."

In this area, there are issues that the whole industry has been addressing with varying degrees of enthusiasm and success for many years, such as the standards used in reference or static data. "There is no ISO standard," says Rickard.

Di Giammarino says that "ultimately this will force a whole new level of management transparency" but adds that firms should look at SCV as part of other regularly and process issues, such as liquidity reporting.

"Know Your Customer and Single Customer View have been around for ever really, but there has not been the will or the budget to address the issues - and, basically, it's hard," he said.

www.dataflux.com/scv