Before we get into detail about the use of technology in customer onboarding and KYC online, first we must understand the process of KYC. Know Your Customer (KYC), a term that explains itself. This law came into existence due to the increase in the crime rate. The regulatory bodies and law enforcement bodies made this law to obligate the business entities and money service businesses to not onboard their customer without performing KYC verifications. The customers must provide businesses with their personal and identifiable information before onboarding. The businesses must record the information and verify their identity to ensure they have no involvement in any criminal or fraudulent activity. They are to keep an on-going check on all their customers and if found with any suspicious activities, they must immediately involve the authorities to carry out the further verification procedure on the identity in question. The KYC process assists the businesses with secure onboarding but what about the simplified and seamless onboarding procedure? KYC online is the answer to this question and read this blog to further find out the importance of KYC online.
The Hassle of Client Onboarding
Most businesses just work on selling their product and gaining money as soon as possible. Their focus is not on the identity of their customers but on how much the customer is willing to pay. This results in fraudulent activity and the businesses end up losing more than what they expected to earn. Unfortunately, the obsolete method of performing KYC checks are so frustrating that who can blame them?
While onboarding a customer, especially financial institutions, they must perform the identity verification process but this process takes weeks, and meanwhile, the customer becomes so annoyed that he changes his mind to onboard altogether. No customer will have that much free time on their hands to wait hours and days to just cross one task off their list. Even if the entity becomes successful in onboarding a customer, there is still no surety that their conventional KYC process has provided accurate customer verification results. Even after such a lengthy process, the company is still not safe from fraudsters. To keep up with a fast-paced world, a fast-paced solution is required.
According to a study by Deloitte, 38% of the customers will abandon the onboarding process if they feel that the process is taking too long or requires more information than they want to disclose.
A Digital Solution for Client Onboarding
Technology has changed the course of the world and it has also revamped the customer onboarding process. A digital solution to perform e-KYC has made the process of onboarding a customer easier than ever. According to a study, 90% of the customer onboarding time is reduced due to KYC online. More customers are likely to onboard if the time of onboarding is reduced from weeks to just seconds. Fraud detection and customer verification solutions use the technology of artificial intelligence to simplify customer onboarding as well as provide highly accurate results for identity verification.
KYC online can verify the identity of the customer from their chosen location. The verification process can be done through face verification, document verification, and address verification. In order to perform KYC online through face verification, the customer has to send their selfie, the AI-powered solution will verify their face through 3D-depth perception and liveness detection test and verify their identity through authenticating their face. For document verification, the customer has to just send a picture of their identity document and the document will be analyzed and will be verified. For address verification, a picture of the identity document along with a secondary document must be submitted, and the digital process will screen the document and verify the identity as well as the address of the customer.
The Next Step in KYC Online
Video KYC, a process of customer onboarding through a video call based interview with a KYC expert. This process is the next step for customer verification. A human KYC expert guides the end-user through the verification process and both facial recognition and document verification is done through this process. The process has proven to be immensely accurate as it uses both AI and HI and it only takes a few minutes to complete the process.