Tuesday, July 30, 2019

RBI May Soon Release Video KYC Norms For Financial Services Firms.

Did you ever have to re-schedule your day for an in-person verification of your identity by a financial services firm? Have you ever feared the misuse of your Aadhaar card details required by a representative of a mobile wallet company? Did you ever have to wait for too long for Aadhaar authentication-based onboarding as a customer for a fin-tech service because you couldn’t take out the time to be available at your address for KYC formalities? 

Aadhaar eKYC norms
We are talking about the previously mandatory, in-person verification and Aadhaar eKYC norms as laid down by the controlling authority of financial services in India. The scale of time and cost involved at the end of the service provider as well as the customer was considerable. Also, the access allowed to private companies to the biometrics database attracted the strict vigilance of the authorities. With the massive surge in India’s fin-tech industry and the strict mandates by the Reserve Bank Of India in relation to the authentication of the customer base, a cheaper and quicker alternative to the cumbersome customer verification process appeared to be a must. 
Why Video
Certain industrial bodies, associations, and leaders have pushed the supreme authority for a video-based eKYC method. This digital eKYC method will drastically reduce the time and cost involved in the remote onboarding procedure for several products such as the savings account, credit cards, etc. The Reserve Bank of India is expected to soon release live video authentication norms for financial services companies. 
As per a report issued by the Reserve Bank of India, dated June 25, 2019, the proposed process is as follows:
  1. The customer has to first signup for such a facility at the service provider’s mobile application or website.
  2.  An appointment as per the customer’s preferred date and time are scheduled.
  3. During the signup process, images of original identity and address proof are shared by the customer.
  4.  An offer is then generated which needs to be accepted by the customer through OTP (One Time Password) based click-wrap. 
  5. The service provider will then initiate the digital verification process. An option of the physical visit will be provided to customers, in case they are not comfortable with the digital process.
  6. The digital verification process is outlined and the customer is connected. 
  7. Video call using Google Duo or Facetime (For Android and iOS users respectively) is initiated.
  8. The service provider’s authorized person needs to identify himself/herself through a valid identity card.
  9. The customer is then requested to display the original proof of identity and address. The authorized person then verifies the name as pronounced by the customer, matches the photo on the proof with the face of the customer on the call, and verifies the address against the image of proof address earlier shared by the customer. Also, address availability is verified as per the details in the displayed document. 
  10. Once successfully verified, the authorized person confirms the completion of video KYC process on the particular date.  
  11. The KYC video is then uploaded by the authorized person.
  12. The person who double-checks the process verifies whether the image of the proof of Identity and address and the verification video has been successfully uploaded or not. 
  13. On the successful completion of the procedure, the customer is duly informed and asked for its consent to proceed with the service provider. 

While many of the non-banking companies are in different stages of design and implementation, certain companies such as Flipkart has initiated a pilot project with about 10,000 users, with a target to soon roll it out to its larger customer bases. The digitization of the financial architecture, if successfully replaces the feet-on-street model, will facilitate an overall financial inclusion and the making of a truly ‘Digital India’. 
For more information contact us.
We, Finahub, are experts in Aadhaar related products and services like eSign, eKYC, Authentication, etc. If you want to know how your enterprise can start using it, please give us a call  @ 0484 2388285 or email us at [email protected]