The customer identification process is globally known as KYC, which stands for Know Your Customer or know your clients. It is the process of identification and authorization of the customer considering risk factors related to the business. Banking and financial institutions generally practice KYC as part of the regulation of general banking and anti-money laundering activities. However, some enterprises are also practicing KYC to control the risk factors and ensure the anti-bribery compliant assessment with their clients.
What is KYC
The customer identification process is globally known as KYC, which stands for Know Your Customer or know your clients. It is the process of identification and authorization of the customer, considering risk factors related to the business.
Different Types of KYC
From the very beginning, the process was practiced in the paper-based documentation. The system required substantial administrative costs and manpower.
This method uses a computer system to record all data of an individual. The system is time-consuming, prone to data breach, and required troublesome API integration with the core system.
Biometric Based KYC
This method uses biometric technology to identify a customer. This is the BEST METHOD FOR KYC.
Why Is Biometric KYC The Best?
Provides accurate identification and eliminates the difficulties of identifying the right person and reduces the risk of the financial transaction.
Biometric technology authenticates the individual in less than a second and reduces the hassles of repetitive authentication.
Protecting customer’s identities, and preventing identity theft the biometric KYC enables the banking institutions to reduce the transaction risk.
Here are the infographics that show the different methods of customer identification