What is KYC?
KYC means Know Your Customer and sometimes Know Your Client. KYC Verification.
KYC or KYC check is the mandatory process of identifying and verifying the identity of the client when opening an account and periodically over time.
In other words, banks must make sure that their clients are genuinely who they claim to be.
Banks may refuse to open an account or halt business relationship if the client fails to meet minimum KYC requirements. KYC can be used in:
Real here some practical examples of using KYC:
- Fintech revolution’s still not here a year into ‘open banking’ in Europe
- Starling Bank launches online banking
- Belfrics Group announces the launch of its KYC compliant Blockchain – Belrium
- MoneyNetint Forms New Partnership with Onfido to Enhance Biometric Security
- India tells tech firms to protect user privacy, prevent abuse
- Exclusive: Oracle has received requests for information about Google
- EU to push G20 on global response to Facebook’s Libra
KYC Verification Process Steps
Just like the way traditional banking institutions were used to verify an identity, online KYC verification is performed. KYC verification process steps include;
Collection of Information – KYC Verification
The first step in KYC verification involves the collection of personal information from an online user. The user is supposed to enter all the personal details at the time of account registration.
Ask the user to Upload an Evidence – KYC Verification
After collecting information, in the second step, ask the user to upload a supporting piece of evidence as an identity proof. This helps the system verify that the user-entered information is not fake and holds authentic data.
Verification of information – KYC Verification
Once the user uploads a document as proof, the document template is identified and data is extracted from it using OCR technology. In this step, many other processes take place. For instance, the document is examined against several checks to make sure that it is not tempered or photoshopped.
Once the authenticity of the document is proved, the information is checked. If both user-entered information and the one present on the document matches, the user is verified.
What are the Best KYC Solutions?
In today’s fraud prevalent society, the threat to businesses and financial institutions that utilize the power of the internet are real and impactful. Best AML KYC Solutions 2020. Best KYC Solutions.
A legal entity on-boarding customers from a global audience base, is required to implement a reliable digital kyc services provider to mitigate risks associated from identity theft and financial fraud. For businesses, better protection from compromised individuals with questionable risks and reputational strength from a regulatory standpoint.
The lists mentioned below shall not only be informative, but also vital for your future growth assessment towards a dedicated Regtech provider.
Why is the KYC verification process important?
KYC procedures defined by banks involve all the necessary actions to make sure their customers are real, assess, and monitor risks. These processes help prevent and identify money laundering, terrorism financing, and other illegal corruption schemes. See this examples:
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A hacker gained access to 100 million Capital One credit card applications and accounts
- Facebook says 100 software developers may have improperly accessed user data
- CipherTrace Unveils Trustworthy Open Source Solution for FATF Travel Rule Compliance
- Digital Fingerprints develops continuous authentication
KYC process includes ID card verification, face verification, document verification such as utility bills as proof of address, and biometric verification.
Banks must comply with KYC regulations and anti-money laundering regulations to limit fraud. KYC compliance responsibility rests with the banks.
European anti-money laundering legislation means customers and businesses are required to provide potentially sensitive documentation to prove their identities. But how safe are the methods of sharing and storing those documents? Are these attempts to strengthen security creating security and privacy risks of their own? Is Privacy Under Threat From All The Know-Your-Customer Documents Stored With Countless Services?