With the rise in the demand for social distancing practices due to stop the spread of Covid-19, the organizations are adopting more digital ways of business services. Virtual conferences, online meetings, and remote workshops gained a swift following year. Like other operations, the methods for customer verification during onboarding also digitized. The best way to customer identification and verification is by Video KYC (Know Your Customer). Although the world has partially recovered from Covid-19 effects, the ease of virtualization and digitalization can also be availed in the future.
The identification and verification of the customer are known as Know Your Customer. The identification is done by name, age, or address, and all of this information is verified through government-issued documents. The documents that are used for identity verification (name and age) are called primary documents, can include:
- ID Card
- Driving Licence
The documents that are used for address verification are known as secondary documents, like:
- Utility Bill
- Bank Statement
- Insurance Certificate
- Employee Letter
- Tax Bill
The authenticity of the above documents is also checked in Know Your Customer verification.
Traditional KYC vs Video KYC
Times ago the KYC verification was done at the office of the business in which the customer gives all of his documents and some employee verifies all of its data and authenticity. The problem with traditional KYC was that the customer has to schedule a physical visit. This process was very time and resource taking for both customers and businesses. The traditional KYC was very irritating because the customer was bound to physically visit the office. Then communication gadgets and the internet provide the comfort of remote verification through e-KYC. In this method the software does all the verification of the data, the customer just uploads his live selfie and image of documents. The software checks whether the data is accurate, genuine, and belongs to the same person who is undergoing e-KYC verification. Through e-KYC a customer gets him verified remotely, there is no need for visiting offices for verification.
Some of the customers also have reservations over e-KYC because some users are not pleased with the software interface. This results in a high rate of drop-offs, sometimes the user didn’t upload the image or the software didn’t check the image correctly due to slow internet. And businesses had a problem with the integration of heavy software to their websites and data management of verification results.
This problem was solved through video KYC. Now a customer can be verified through a video call with a KYC expert. All of the e-KYC verifications are now done on a video call. The KYC Video Customer Identification Process is explained below
- Customer and KYC expert links on a live video call. This live video call platform is provided by the KYC solution provider. No third-party platform is not used for communication.
- Documents are shown by the customer to the KYC expert. The KYC expert clicks pictures of the document.
- KYC expert asks personal questions from the user to mitigate the risk of pre-recorded videos or holograms. The liveness detection is done by observing the physique gestures and facial emotions of the customer.
Optical Character Recognition (OCR) is employed for data extraction from documents. AI-enabled OCR can extract data from any script or language. The video can also be filmed for further proof but with the consent of the customer. Some businesses need to have a record of all the verifications but have data management constraints. e-KYC also provides this service but with a huge data load. Video KYC data is in low bytes and extended searching algorithms.
An organization can choose a native KYC expert that can interact with the customers in a local language. Another facility that video KYC gives is a customized security verification system. Like some businesses accept expired documents but online cab services can’t accept expired driving licenses because of government regulations. Other businesses like this can choose verification methods of their own convenience.
Summing it Up
As financial institutions like banks, insurance corporations, and money exchanges are bound to have Anti Money Laundering screenings and Know Your Customer verification by regulatory authorities. Video KYC gives the efficiency of compliance with all the regulatory authorities’ guidelines and directives. Cybercrimes like identity theft and account takeover can be minimized through ID video verification. Customers will have a better online experience by getting video verified. The cost of having video KYC is very low as compared to e-KYC and gives more accurate and secure results of verification.