Implementing ID verification for KYC in the right way

KYC ID Verification

If you’re a regular reader, you’ll know we’ve written about the importance of secure identity infrastructures. These are already being deployed in the mobile and e-Government spheres, with notable success (Nigeria’s mobile citizen scheme being one example). User verification is also becoming increasingly important for financial institutions, where Know Your Customer (KYC) strategies are seen as crucial for tackling fraud, money-laundering and other criminal activities. However, KYC isn’t always done correctly, and can become a financial and administrative burden. If it’s implemented appropriately, it can expand capabilities and enhance consumer trust in your organization, as Posten Norge, Norway’s leading postal service, has recognized.

An important part of the KYC process is about verifying that customers are legitimate through robust enrollment and compliance frameworks. If you’re under the impression it’s a trivial procedure that can be overlooked, think again. JP Morgan paid more than £16bn in legal penalties last year, while Standard Bank was fined £7.6 million in 2014 for not doing enough to prevent money laundering. The need to comply with new legislation, such as the EU Anti-Money Laundering Directive (AML4), has led banks and businesses to create time-consuming, complex and confusing KYC processes, especially for the verification of the identity, which are driving clients away.

What isn’t always realized is that it’s possible to implement ID Verification in a more innovative, flexible manner, bringing benefits to financial service providers and end-users.

From an enrollment perspective, businesses need a way of testing customer credibility without putting them off. One way to achieve the balance between security and convenience is the Gemalto ID verification platform, which allows customers to enroll quickly without jeopardizing the integrity of the KYC process. The solution can quickly verify documents, evaluate risks and produce reports for auditing purposes. It’s also adaptable to businesses’ channel process, whether they prefer face to face, online or mobile interactions. It’s a great way to comply with KYC requirements without damaging the customer experience.

A company benefitting from an innovative ID verification solution is Posten Norge, Norway’s national postal and logistics service. It’s adopting Gemalto’s award-winning Coesys ID Verification, a distributed software system that automatically verifies the electronic and physical security features of identity documents.  Coesys ID Verification enables customer credentials to be instantly checked for discrepancies against Gemalto’s global database of passports and other documents, ensuring packages are delivered to legitimate recipients. It also allows Posten Norge to verify the recipient of a new payment card, enabling it to strengthen relationships with the country’s banks. In the future, the platform could allow Posten Norge to become a national KYC and ID verification hub providing innovative new services, perhaps as a portal for sharing virtual documentation in a secure way, acting as a central ID provider for a range of enterprises.

As the digital revolution gains pace, we’re expecting Coesys ID verification to witness further adoption in fields as diverse as e-Gov, mobile eVerification and voter authentication.

Evidently, KYC is vital for businesses and it’s crucial intelligent, innovative procedures are found. Effective user verification processes can allow businesses to speed up on-boarding processes and provide new services to their clients. What do you make of Posten Norge’s approach to the issue? Let us know by tweeting to us @Gemalto, or by posting a comment below.

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