The KYC verification method was implemented to combat the widespread incapacity to identify and prevent online fraud. As technology became more widely adopted, the number of occurrences of identity theft increased, necessitating the implementation of due diligence measures in international commerce.
KYC verification is governed by government authorities in any nation because of its sensitivity to enterprises. When opening a bank account or executing any type of financial transaction, KYC verification is required.
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How Does KYC Work?
KYC compliance online is an important aspect of the client identification system in financial services. The purpose of this procedure is to verify the identification of clients in order to avoid economic relationships with persons who are involved in fraud, terrorism, corruption, or money laundering, among other things.
The KYC verification process enables businesses to verify who their customers are in order to provide them with the services or goods they require. The eKYC procedure, which is done online, enables for quick onboarding of new customers onto a financial services platform.
Identity Verification Online For KYC
Identity verification ensures that a person’s identity and the processes they perform are both genuine. Banks use this method to prevent people from creating false identities or engaging in fraud.
Identity verification can be accomplished through a number of approaches. Verifying an identity may be done in a variety of ways, depending on the channel and the service being provided.
A person presents his or her identity document to the agent at the same time in the conventional method so that the agent may verify the person’s identity by comparing his or her look to the image on the identification card.
How Does Identity Verification Online Work?
There are various techniques of online identification, but only a few are adequate and fit the criteria for a secure and trustworthy process.
It will be helpful to use a remote identity verification solution that fulfills high security/reliability criteria as well as legal requirements. It can assist businesses in securing and expediting their client onboarding processes. Fraudsters will be immediately denied, while legitimate consumers will be onboarded in seconds, thanks to cutting-edge AI KYC verification systems.
The Online Identity Verification Process
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The user will often register by entering information on the organization’s website, app, or platform.
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The user gives permission for the device’s camera and microphone to be used to verify identification.
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The user is then required to display both sides of their ID card, passport, or driver’s license in order to be recognized and validated. We verify the legitimacy of the IDs in real-time by recognizing key elements such as the MRZ code, signature, stamps, rounded edges, and so on. After the format has been checked, we employ OCR techniques to extract the user’s information and compare it to the data gathered through the previously completed contact form.
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Face recognition requires the user to snap a selfie, which the system then compares to the photo on the ID.
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The most critical stage is to identify life. We want to make sure the person in front of the camera is a real person who isn’t spoofing the check using tricks or artifacts like papers, masks, faces, or digitally implanted face swap algorithms. The state of being alive might be active or passive. The most frequent type is active liveness, which involves requesting users to do things like close their eyes, tilt their heads, or open their lips. Passive liveness doesn’t need users to take any activity; instead, it examines numerous aspects of the previous selfie, such as brightness, background components, and, of course, the user’s face, to look for indications of manipulation.
Why Biometric Identity Verification is the Right Solution for Banks and FinTech?
Money laundering and terrorism funding are two financial crimes that banks and financial organizations are battling to prevent. The KYC banking procedure performs the same checks as other businesses, but regulatory requirements are more stringent. In order to comply with current rules, banks must go through a thorough Know Your Customer checklist.
Final Thoughts
The number of cases of identity theft has grown as technology has been more extensively utilized. KYC verification methods are essential when opening a bank account or performing financial transactions. As a result of the worldwide pandemic in 2020, many businesses have been compelled to establish Know Your Customer operations remotely.
In the last several years, biometrics KYC online verification for customer onboarding has become more popular. For both parties, using systems like these makes client KYC verification and identity a simple and safe procedure. eKYC solutions can also assist banks in automating the onboarding process.