The boundary between the physical and digital identity of a person has been reducing to a great extent due to the innovation in cyber technology. The introduction of the digital marketplace has fully modified our lives by giving us the facility to obtain products and services online.
However, along with a number of benefits, there are some negative points to this advancement as well because the whole world is interconnecting online which unfortunately makes it vulnerable to attacks from cybercriminals and scammers throughout the world. The cybercriminals tactically conceal their identities and anonymously perform various fraudulent and illegal activities online, resulting in losses of billions of dollars per annum.
How are KYC and identity authentication linked?
To minimize the probabilities of scams, regulatory authorities have devised regulations that help them with the digital identity authentication of the members of the web community. The authorities and law enforcement agencies have also introduced laws that reduce the hazard of fraud activities in the cyber world and also the physical world. Identity authentication is increasingly becoming an important component of Know Your Customer (KYC) regulations.
The foremost purpose of KYC solutions was to limit money concealment and terrorist financing when it was initially introducing back in the late 1990s. Taking a portion from the US book, the Federal Reserve Bank of India also directed all banks to implement KYC guidelines for all new accounts by 2004. Due to its increasing popularity, ID verification has been around for several years especially after the worldwide rate of crime increased. Newer and improvised techniques of customer verification were devising to make sure secure transactions and business operations.
KYC Includes
Since all the transactions are administering through financial institutions and banks, it has been immensely important. To incorporate KYC solutions into their systems. Financial regulatory authorities like FATF, PCI DSS, etc have obligated the adoption. The KYC and AML regulations by financial institutions.
Businesses also are emphasizing following these guidelines for added security. Due to the evolution of the cyber industry and thus the resulting cybercrime. The regular sorts of verification methods don’t seem effective enough. Although the contemporary methods of customer identification. Are considering to be more accurate and safe, fraudsters consistently bring up newer ways. To by-pass the safety barriers set by law enforcement and regulatory bodies.
Digital KYC Solutions
Modern firms are racing with one another, trying to make new inventions to automate the prevailing identity validation techniques. Many have adopted the latest AI technology to figure out. If the user actually is who he or she claims to be or not. This technology is fast and secure and has blogged many cybercriminals from gaining access to the system and cause harm.
The digital KYC verification provides users the facility to verify their identities during a range of scenarios. All of this using just your device’s camera. it’d even eliminate the necessity for a pin or password altogether. The entire customer authentication process takes a couple of seconds. To finish and requires nothing but a webcam or smartphone camera.
The innovative ID verification process is conducting through a number of means, including face recognition. Address validation, document verification, 2-factor authentication, and consent verification. Businesses can adapt the tactics which are best fitting to their needs and requirements. This e-KYC technique not only saves businesses from risky clients but helps. Them suits the worldwide regulations of the financial watchdogs also.
To Conclude...
Keep in mind that a permanent solution for fraud prevention doesn’t exist. It requires ongoing research, effort, and constant innovation to secure your systems from fraudsters. Together these techniques and capabilities, when arranged and triggered, can help create a strong frontier of authentication against criminals. Scammers and hackers are quick to evolve their evil schemes, therefore businesses and individuals. Got to stay a step before them to remain safe and secure.
