This gave the financial sector just enough time to put the technologies in place to enable the video-based eKYC process to allow new customers enter the financial markets digitally during the lockdown.
Just about two-and-a-half months before the nationwide lockdown was imposed to contain the spread of highly-contagious Novel Coronavirus Covid-19, the Reserve Bank of India took a decision to allow the use of video KYC (Know Your Customer) to facilitate onboarding of new customers through eKYC.
This gave the financial sector just enough time to put the technologies like – Optical Character Recognition (OCR), Live Video, Artificial Intelligence (AI) etc – in place to enable the video-based eKYC process to allow new customers enter the financial markets digitally during the lockdown.
Talking on the role of emerging technologies like Artificial Intelligence in eKYC, Pankaj Gupta, CEO & Founder, EnableX.io, said, “The traditional form of verifying customer identities, also known as the ‘Know Your Customer (KYC)’ process, required a new customer to visit a branch location to have their personal identification documents verified by a branch employee.”
“However, with consumers wanting the convenience of signing up through digital channels and banks striving to increase new account enrolments through faster, easier and lower-cost digital channels, many have turned to digital KYC,” he added.
“To ensure the authenticity of the customers when doing digital onboarding, banks are increasingly leveraging a combination of Optical Character Recognition (OCR), Live Video, and Artificial Intelligence (AI) to conduct identity proofing and AML screening more efficiently,” Gupta further said.
Talking on the use of the technologies, Gupta said –
- With the help of OCR, the data extraction process becomes swift and removes the need for manual data input of personal particulars such as name, date of birth, address and more.
- The use of Live Video helps in numerous ways. Primarily, the customer can engage with the representative via video call, from the comfort of his home, and the representative can quickly verify the information uploaded and authenticate the customer in real time.
- Live Video also helps test a customer’s “liveness” by getting the customer to answer random questions over video call and tracking his facial movement in accordance with them.
- Going one step further, the use of Artificial Intelligence adds an additional layer of security via features like Face Biometrics and Emotion Recognition and aids in enhanced “identity proofing”.
- Customers can upload/capture a photo and the system’s facial recognition technology performs an identity check by matching the video to the picture uploaded, without requiring manual intervention.
- If a user is successfully onboarded, facial recognition can also be subsequently used to compare a recent selfie with the original photo captured and uploaded during the onboarding process.
Talking on the benefits of Artificial Intelligence, Gupta said, “AI also detects and evaluates face and facial features, head poses, eye gaze, emotions and much more that could be difficult for a human mind to capture.”
“This can thwart fraudsters who are using spoofing attacks wherein the applicant uses a static image or a pre-recorded video, etc. to deceive the financial institution,” he added.
Expressing his optimism about the India scenario, Gupta said, “Going forward, providing digital onboarding will also help financial institutions to extend the horizon of their services to new customers as loan requests escalate during the current crisis.”
“However, one must keep in mind that eKYC has its own limitations if not done meticulously. It is thus important for financial service providers to pay due diligence and invest in the right technology tools and work with reliable technology partners that enable them to do so on-premise. This not only decreases external dependence but also helps ensure compliance with regulatory requirements and provide a secure experience to the customer,” Gupta further said.