Know Your Customer (KYC) is a fundamental part of authenticating a customer’s identity before their induction into an institution’s system. It is also known as the preliminary step of a greater AML compliance program. To complement this process, video KYC is introduced as a verification method based on videoID which is more suitable for the current pandemic environment.
What is Video KYC?
Video KYC, also known as digital identity or video verification, is a digital way used by institutions to verify the identities of incoming customers. This process involves a digital submission of documents containing the information of the customer. Then, a KYC expert/agent matches the customer through a video call, with the provided documents. Hence the name Shufti Pro Video KYC.
How does the Video KYC process work?
Video KYC process verifies the identity of the customer in the following way:
- Firstly, the customer is required to register on the business’s website.
- A video call is set up between the customer and a KYC agent on the behalf of the business. The purpose of the video call is to add a human verification step.
- The KYC agent, then, verifies it is a real human being talking and not a picture or a hologram, in front of the camera. This is known as liveness detection.
- The KYC agent asks the customer to display the document. The agent matches the person on-screen with the picture on the document.
- A screenshot of the document is taken and it is checked whether it is forged or tampered with.
- In the end, the results are shown to the customer or sent to the back-office API.
The Need for Video Verification in Covid Times
As the pandemic’s first year has passed, it is becoming more and more evident that identity verification methods need revamping. Precautionary measures from Covid-19 demand social distancing so physical document and identity verification methods need some rethinking. This problem is addressed by the arrival of Video KYC. It enables contactless identity verification by:
- Removing physical submission of documents to avoid any contact.
- Providing a quick and efficient solution for verification.
- Securing the customer onboarding process while cutting the cost.
Why Move from Physical to Digital?
As technology progresses, we need to move with it. This is the rule being followed for centuries that has reaped major rewards for mankind. Maximizing efficiency, reliability, comfort, ease and above all, time-saving are some of the benefits of adapting to the changing technology. Standing in the queues for hours for something that can be done in the comfort of your home, is certainly not wanted by anyone. Avoiding the hassle of carrying documents, and stop worrying about theft is surely a brainer. So, institutions are adapting to this changing landscape by employing the services of video KYC systems. As a result, their Anti-Money Laundering (AML) and Know Your Customer (KYC) compliance process enhances while making the lives of their customers convenient.
Modern Crimes require Modern Solutions
In contemporary times, criminals are employing cunning new tactics to commit fraud and identity crimes. When everything is being done online, the severity of online crime has also been on the rise. While identity theft is nothing new, criminals are now tampering with pictures and videos using a novel technology called deep fakes. This technology aims to alter the visual and audio content using artificial intelligence and machine learning. Deep fakes are based on training neural network architectures like Generative Adversarial Networks. The financial or law enforcement institutions are, therefore, tricked into believing that the picture or the video is verified.
Moreover, another crime that puts law enforcement agencies at their wits’ end is synthetic identity fraud. In this method, fraudsters get their hands on a legitimate piece of personal information i.e, CNIC or social security number (SSN). Then, they start creating a fake profile based on that information up to a point it seems legal to the financial institutions.
So, utilizing the same old techniques to differentiate between real and fake would not be enough. Thus, video KYC provides a solution to overcome this problem and be one step ahead of modern era crimes. It will check for liveness detection and add a human verification step i.e, the KYC agent, to check whether something is suspicious in the video or not.