Legal Entity Identifier, also known as LEI is a unique innovation that is making the financial sector safer and more transparent. This 20-digit identifier came to light as an answer to the rising rate of cyber crime and digital manipulation of financial data.
The 2008 meltdown in the financial sector highlighted the immediate need for a transparent system that would eliminate the bad players. This need resulted in an idea that revolved around identifying all legal entities involved in every single financial transaction, irrespective of their geographic locations.
An ideal global LEI data provider not only identifies the involved parties of a financial transaction, but also confirms the authenticity of the transaction. Analyzing the LEI data is a fast and secure process that can be handled by anyone and from anywhere.
Searching the record
One can simply visit the website of a credible global LEI data provider and use the search option to check if the concerned party is genuine and authentic. Additional information, such as ownership details are also provided for most of the registered entities.
Challenging a record
LEI search has not limited the scope of users to just viewing. Any person not agreeing to a certain entry can challenge the record as long as he/she can provide the required documents to prove the point.
Saving a record
Any proper provider has the website shaped in the most user-friendly format possible. A simple interface with easy-flowing options makes the life of a viewer lot easier. Every single record can be saved in text as well as pdf formats for future reference and audit purposes.
Different levels of maturity
With the volume of LEI data steadily on the rise, it has become imperative for the concerned authority to categorise the data under multiple levels. The quality is determined by the level of maturity of an entity. Once LEIs achieves the record of 100% data, they get stamped as level 1 maturity. The level 1 maturity is also marked as the required quality slab.
The ones with more than the required 100% data are mapped as level 2 maturity. This level is marked as expected quality.
The LEIs that manage to score more than the level 2 entities are marked as level 3 maturity. This level is the hallmark bracket and doesn’t come with any upper capping. This slab is also marked as excellent quality.
The extra push for institutions
The marking and maturity slabs make sure that all concerned entities keep their records updated and improved. No institution would want to gain a bad score, ensuring that viewers always get to enjoy the most authentic and recent entries.
Wrapping it up
With the steady rise of financial wrongdoings across the world, the need for a global watchdog is more than ever. This is where LEI comes into the picture. The concept of LEI has brought the much needed transparency and authenticity in the segment of financial transactions. It allows everyone to check the involved parties for authenticity before going ahead with a transaction.