FINMA Allows Chip Scanning and Geolocation for Digital Customer Onboarding

  • Richard Marley
  • May 19, 2021
  • 2 minutes read
  • 185

The FINMA now enables the scanning of microchips inserted in biometric ID documents as an element of the online onboarding procedure. The modifications will come into action on the 1st of June 2021.

Therefore, the Swiss Financial Market Supervisory Authority will enable geolocation to be adopted as an option for confirming the contracting person’s residence address. 

Two years after the last amendments to the “Video and digital recognition” Circular, FINMA is additionally renewing the procedure for introducing customer relationships digitally to take the most advanced technology into attention. 

Digital identification procedures will be further digitized to allow businesses to provide a seamless onboarding experience for users. 

Therefore, consideration has been given to the technological opportunities presented by biometric passports. 

Under the new amendments, monetary intermediaries might dispense with the bank transfer adopted to recognize users if the necessary information can be interpreted from the microchip inserted in biometric ID documents. 

Swiss Financial Market Supervisory Authority conducted a public meeting for the partial change of the above announcement. The opportunity of adopting chip-based data from biometric ID documents was universally embraced, and several respondents were interested to discuss additional alleviations in the identification procedure. 

Conversely, FINMA views digital video-based identification, supported by manual verification which is not sufficiently safe to enforce with additional safety mechanisms such as bank transfer or the newly available chip scanning.