During this time, the digital revolution plays their role globally and the financial industry is not left behind. The term Fintech means ‘financial technology’ that promotes money transfers, digital payment systems, asset management, investments, etc. Fintech operates with customers digitally like financial institutions and physical banks. Because today the world wants everything online. Due to these reasons, digital banking in the form of Fintechs is very popular and also digital/remote identification has a great demand. Fintech industry is making use of digital identity verification to comply with KYC and AML regimes in which they perform documents verification and biometric verification of the user. There were some loopholes in previous methods; that’s why video KYC in USA solves the challenges in the video identification of KYC and uses strong algorithms to verify the identity of an individual remotely against a video. The method helps to eliminate fraud by ensuring that the person on the video call is genuine. The process of video KYC is quick and doesn’t take much time. Apart from that, it is convenient for both customers and the employee who conducts identity verification. It is a safe method that is beneficial for Fintech businesses in attaining a clean customer base. Criminals and frauds pose a big risk to Fintech businesses, and video KYC helps them to stay away from people who have cruel motives. Also, KYC/AML compliance becomes easy and quick by taking the help of digital methods. The video KYC process is done live, and the user needs a working internet connection and a laptop, phone, or tablet. The end-user is guided in real-time to show his/her identity documents to the camera for verification. Artificial intelligence, optical character reader, and facial recognition technology are used in the process so that there are no errors. A few questions are also asked from the user.
Real interaction with Users Video KYC is a real interaction with customers over a video call. The process is done to verify the identity of customers. The user is asked to show the identity documents issued by the government, and he has to answer a few questions. Customer behavior is also noted by experts during the KYC process. It is also detected if the video is live and not a pre-recorded one.
Cooperative audit A cooperative audit is done to make the account operational after the video KYC process. The audit is performed with respect to system security and KYC application (video). The account is created after verifying the information. The cooperative audit is of great help to make only trusted and genuine customers to become part of the financial system. This way, financial institutes can avoid cases of money laundering.
Final Words
Fintechs trust video KYC onboarding because it uses the latest technology and saves them from fraud. The process is simple and convenient for users, and they can get KYC done from the comfort of their homes.
Source: https://signzy.mystrikingly.com/blog/fintechs-trusting-video-kyc-to-preventfraud