Technology

Video KYC – An Advanced Solution to Combat Fraud

KYC

Businesses have seen a dramatic change in the past two years, with digitisation being the major development. Firms have shifted their operations to the internet as a result of the COVID-19 pandemic to take advantage of the international market and enjoy the benefits. Financial institutions have advanced the most in their customer on boarding processes. Firms must find the balance between safety and customer happiness as they are going digital. Which technique should be taken to ensure that KYC/AML requirements are met while simultaneously offering a better customer experience? Video KYC is however one alternative, as it enables real-time customer on boarding while also adapting to changing regulatory needs.

Video-Based KYC vs Traditional KYC

The term “know your customer” refers to the act of verifying a person’s identity and detecting any potential dangers associated with that user. AML regulations must be followed by financial firms and other entities that deal with money. Companies have historically used a physical customer identification scheme to confirm customers’ identities while they are on boarded. Because the operation could take weeks, clients are compelled to quit it in the middle.

The video KYC is a modern version of the traditional KYC, but it is better, simpler, and affordable. It replaces paperwork with meaningful results, allowing the whole verification process to be completed faster. Customers no longer need to visit the organisation and provide their identity documents in order to open an account. This is all done virtually with only a single click.

Know Your Customer Checklist

The essential documents required according to the year 2021 KYC compliance checklist are as under: 

  1. Proof of Identity

  • A voter’s ID card, passport, or driver’s license
  • The latest government-issued ID card 
  • A valid debit card or the credit card which is issued by the bank
  • A permanent account number card along with a photo that matches the client

2. Proof of Address

  • Driver’s license or visa with the original picture
  • A copy of electric or any other utility bill with an identifiable address
  • An identity document in the name of the individual’s spouse
  • A  copy of the lease for a residence or registered sale agreement

How Does Video KYC Solution Work?

Video verification is similar to traditional KYC except that it completes the verification via video conversation. During the video call, individuals must confirm their identification by giving acceptable ID documents. Instead of depending on multiple platforms to complete the verification, video KYC allows for true multichannel connection with the client, enabling both face and document validation while the user is on the video call.

Growing Need for Video Identification

Video authentication is a popular topic at the moment, and that is not an exaggeration to label it the motivating factor behind the progressing identity verification market. In addition to making the verification process efficient and cost-effective, the ever-increasing identity theft mandates the implementation of a verification approach that should be secure and video verification is a great bet in that case.

In today’s digital age, one of the pressing problems for industries is cybersecurity, and video KYC verification is an efficient approach to thwart fraudsters’ sophisticated tactics. Client verification based on video KYC protects against several identity scams, including:

Synthetic Identities

Synthetic identity frauds are among the most difficult to detect because of the blatant nature of the fraud. Fraudsters mix real information like social security numbers with fake information to create a convincing persona. These forgeries are difficult to recognise in the early stages of fraud, but now with video verification solutions, they may be quickly recognised, preventing further fraud.

Spoof Attacks

Fraudsters are becoming increasingly competent at using spoofing attacks to reveal their malicious intentions as a result of the digital transformation. Imposers use forged or hacked identities to deceive and bypass verification mechanisms. Because this type of documentation and face spoofing attack is hard to detect, it is not advisable to rely exclusively on the system’s findings. KYC video identification employs human-computer intelligence to detect spoofing attempts in real-time.

Deep Fakes

Deep fakes are films created using a deep learning algorithm. They’re made to fool the technology and gain access to personal information. For instance, fraudsters can use deep fakes in facial verification to get beyond identification checks. Because such movies are remarkably similar to actual films and are hard to distinguish, a more secure e-KYC video verification is required.

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Final Thoughts

Video KYC is a well-known practice in the verification market. With the use of this solution, businesses can optimise their on boarding process and reduce KYC turnover time. Firms are trying for better online solutions in order to meet changing client expectations and prosper in this digital age. Video check is one of the approaches that will be integrated into a range of businesses in the coming years; in fact, numerous organisations have already started using this solution for client on boarding. It enables fraud-free customer on boarding when used in conjunction with the genuine digital document validation service. 

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