Let us have a short tour of KYC within the banking industry! In 2002, all banks were asked by the regulatory authorities to strictly acquire the personal information of the customers. This was being imposed on them to prevent money laundering, terrorist financing, identity theft and other financial frauds. From that point onwards, the term ‘Know Your Customer' gained more popularity, and later it became an essential element to help banks know their customers.
By assessing the use of KYC within the banking industry, we can be aware of its significance for the banks because knowing about customers makes it easier for them to understand their financial activities. Many banks started implementing various techniques that were meant to improve the strategy for KYC, but the ratio of financial frauds kept on increasing. As we know that banking industry is known to be the most proactive industry that uses the advanced technologies to improve the customer's' experience. Hence, the need for stimulating the KYC process becomes equally important. This need has led the banking industry to make use of digital technology to enhance the KYC experience. There are a couple of advantages for the digitization of KYC which are as follow:Paperless KYC
By using a digital verification solution, the old fashioned KYC will be replaced by a quick process over the smartphone or your personal system. The customer’s ID can be digitally verified within few seconds.Real-time verification
Another important use of digital KYC is to eliminate the document forgery as it requires the scanning of the document in the hard form. With real-time verification, KYC will become more reliable like never before!Making KYC quicker
Within just a few clicks, a bank can gather the necessary information of the customer by digitally verifying the document. It has become easier for the banks to know their customers instantly with an easy interface for the users.Safe and secure
Knowing the customers digitally would also make the process more safe and secure. The online digital verification will lower down the chances of identity theft and financial frauds within the finance industry.
We know that the whole world is moving towards the digital technology to maximize the productivity of their tasks. Similarly, while considering banking sector, there should be no doubt why it requires a digital verification solution that can make the KYC process frictionless for the banks. It helps banks to digitally bridge the gap between banks and its customers. The story of digital verification is not finished yet for the banking industry because it can be helpful to make all the transactions more secure by digitally verifying the debit or credit card of the customer. But for now, one thing we have learned so far is that KYC should be done by using digital verification of customer's documents to ensure an effective rapport building