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Blockchain has a number of inherent properties that make it a potentially advantageous technology to use in the KYC space. Immutability of records, enhanced privacy, a shared ledger, and greater transparency are among these benefits
Fremont, CA: KYC has always been an expensive business, with financial institutions (FIs) spending an average of US$150 million on KYC each year. Some of the largest banks are said to spend up to $370 million, excluding remediation costs, which can add up to $670 million.
However, innovation in KYC has been prolific, spawning a slew of new partnerships that are successfully utilizing emerging technologies to transform KYC from a cost to a strategic differentiator.
Important Technologies to transform KYC:
Cloud-based API technology
This technology has the capability of delivering industry-leading data and intelligence directly to in-house compliance workflow systems, allowing compliance professionals to make informed risk decisions.
Blockchain has a number of inherent properties that make it a potentially advantageous technology to use in the KYC space. Immutability of records, enhanced privacy, a shared ledger, and greater transparency are among these benefits.
Blockchain, in theory, provides the ideal platform for delivering an automated, secure, and trustworthy KYC solution that enhances the client experience, simplifies operational processes, and improves regulatory compliance.
Virtual Identity Solutions
These use advanced algorithms in conjunction with proprietary and third-party data to generate confidence flags that can increase the likelihood of reducing successful fraud transactions and enable retail onboarding.
Of course, technology is no substitute for human ability, which brings nuance, ethics, and judgment to the table, but technological advances provide valuable new tools that allow skilled professionals to assess risk more quickly and intelligently.