The majority of nations have well-established Know Your Customer (KYC) regulations that outline identity verification, due diligence, and risk assessment processes. However, many KYC rules and guidelines don’t take into account the realities of digital transactions.
Many nations have adopted electronic Know Your Customer (eKYC) legislation to fit digital and mobile realities, even though it is easy to change laws to make them more applicable. In general, eKYC refers to entirely digital procedures that make use of digital ID systems or identity verification software. For instance, consumers in the Philippines refer to identity verification using the system as “eKYC.”
The eKYC concept applies to all fields of endeavor, but it is particularly delicate in delicate fields like those involving money, investments, and wealth.
In this post, we’ll look into the definition of eKYC as well as its various applications.
WHAT IS THE EKYC PROCESS?
The term “eKYC” is used to refer to digital KYC procedures. Electronic Know Your Customer, or eKYC is the paperless, remote procedure that reduces the costs and conventional bureaucracy required in KYC processes.
Identity, signature, and phishing fraud are all fairly frequent. There are zero margins for the commission of these counterfeiting offenses and related crimes thanks to the entirely secure eKYC processes created by specialized enterprises focused on technical compliance solutions.
KYC TO EKYC TRANSFORMATION
Know Your Customer, often known as KYC, is a process to identify and confirm a customer’s identification, as we have already covered in previous posts of this blog. The procedure entails several tests that are carried out during the initial stage of the client interaction to confirm that the customer is who he claims to be, taking into account his identity documents and his persona.
Several laws, such as those pertaining to electronic identity standards, trust services, terrorist funding, and anti-money laundering (AML), among others, have an impact on this procedure (eIDAS).
What is the primary distinction between eKYC and KYC? Well, both offline (in-person) and online KYC practices can be developed (remotely). Here, we can see how KYC is evolving towards eKYC.
All companies and economic actors, but particularly financial institutions and banks, are going through a rapid digitalization process. The most significant organizational changes in the previous ten years have all involved digital transformation, making those that ignore this work lose possibilities in their industry or even vanish.
Businesses and organizations are having trouble digitizing processes that were once challenging to automate and outsource. However, dedicated companies have emerged to carry out this duty, transforming and improving procedures using cutting-edge technology like artificial intelligence and machine learning.
Companies that fall under our category of “RegTech” have emerged, assisting businesses in the implementation of rules and legal requirements with solutions that simplify, streamline, and lower the costs of these processes
Please read: Fake or Real E-mail.
Online solutions from EKYC
The traditional KYC process has been digitally and remotely replaced by the eKYC process. In an improved procedure, the weeks required for completion are reduced to seconds at a significantly cheaper cost.
The instantaneous identification and confirmation of the clients’ identities aid businesses in increasing their conversion rate up to, for instance, 84% in the case of eID solutions, and provides customers with a seamless, easy, and uncomplicated experience. eKYC procedures boost client satisfaction and guarantee that customers can use the service as soon as the company comes into touch with them.
Companies must establish electronic identification procedures with high levels of safety and reliability and adhere to the norms set forth in AML5 or eIDAS legislation in order to ensure that they satisfy the same safety standards as traditional ones of identity and face verification.
A pioneer in the field of digital identification, Electronic IDentification (eID), provides a variety of eKYC API solutions based on artificial intelligence (AI) and machine learning that are simultaneously assisting dozens of businesses in their digital transformation while remaining compliant with current laws.
By moving away from low-security solutions like those based on selfies, our eKYC solutions and technologies manage to cut costs and bureaucracy, automate processes, and deliver the greatest levels of security.
A few of our eKYC solutions, as an example:
- With the same level of security and legality as face-to-face identification, VideoID is the first eKYC video solution to verify identity in real time without the need of agents.
- SmileID is the only eKYC authentication service available that can register consumers in a matter of seconds with 100 percent assurance.
- Advanced cross-device electronic signature solution with SignatureID.
EKYC SERVICES in Particular Aspects
The financial industry has been among the first to digitalize its procedures, including the digital KYC process, for almost ten years. A person can now create a bank account, sign a loan, or even a mortgage in a matter of minutes from anywhere by completing the eKYC process online using automatic video identification.
One of the first industries to benefit from the eKYC procedure was the fintech industry, whose businesses may now do all of their business online. By enabling scalable growth at extremely low costs and an unmatched user experience, eKYC serves as the foundation for Fintechs’ rapid regional and international development.
Conclusion
Reduced paper use and missed records: Assists a bank or company in reducing its carbon footprint by practicing an eco-friendly, cloud-based online mode. Additionally, the e-KYC technology prevents missed recordings and preserves accurate customer data.
