Banks, financial institutions and other businesses in the allied sectors have been struggling to keep up with regulatory and compliance needs, mainly because things are changing rapidly. For those not very familiar with the term. Know your Customer, or KYC, is the process of verifying the identity of a customer using relevant proofs and documents. Traditionally, banks relied on physical documents and papers for KYC, which is a must for compliance. In the digital world, FINTRAC / AML regulations are a reality, as well, and that’s also where digital KYC becomes so important. In this post, we are discussing the relevance of digitization of KYC and why your business must be concerned.
Knowing digital KYC better
As a company, you can reap the benefits of digital KYC using an API. There are many services that provide digital KYC API, and you just need to integrate the same into your platform or app. This, in turn, will verify the customer’s identity using the bank account as the source, so you can check for details like name, address, financial account, and with 99% reliability. Digital KYC is a must of sorts, because it does offer a number of benefits.
Why consider digitization of KYC?
First and foremost, businesses need to be compliant with necessary norms and regulations, and that’s not a choice. Digital KYC is the simplest way to ensure the same. Secondly, you can finally do away with the need for paper documents, and while the laws and regulations are country specific, digitization definitely reduces the work of your people. Scams, money laundering scandals and corruption are some of the concerns that made KYC mandatory for the financial sector, and with digital verification, most of the work can be automated, without any compromises. Identity thefts and document forgery can be prevented, and businesses can finally have a more secure, simpler and safer means for onboarding customers.
There is no denying that customer experience is important for businesses in the financial sector, and while KYC is a must, it doesn’t have to be cumbersome and involve complicated paperwork anymore. If your business is considering an investment in digital KYC API, make sure that you select a company that’s reliable, known and offers significant support for implementation. Check online now to find more on how you can adopt the new means of KYC and make it a part of your customer acquisition procedure.