Live Video Will Solve eKYC Problem For eWallets, Banks – Is This Even Feasible?
RBI has shown interest for live video based eKYC of eWallets, bank customers.
Reserve Bank of India has shown interest in allowing new ways and methods to verify customers – and this includes live video-based KYC.
Why is it required? And how this will happen?
Keep reading to find out more!
RBI Can Allow Live Video-Based KYC Of Users
After the Supreme Court stopped private companies from accessing and storing Aadhaar data due to privacy issues, companies are now looking for innovative ways to achieve this.
And RBI is quite open to ideas.
In recent meetings between RBI and representatives from financial companies, ideas such as XML-based Aadhaar data extraction and live video-based KYC process was discussed.
And RBI has shown keen interest.
When it comes to videos, RBI is more inclined towards live video verification of users, rather than recorded videos which can be verified via Artificial Intelligence.
An official said, “Video-based KYC is a viable process and had been suggested by some technology startups. RBI wants live videos to be used and was not keen on allowing recorded videos authenticated using artificial intelligence,”
What Is The Need For Live Video KYC?
KYC or Know Your Customer process was seamless and easy with Aadhaar – All you need to do is put your thumb or show your Aadhaar card, and it is done.
But ever since the Supreme Court struck down Section 57 of the Aadhaar Act, everything changed. Companies, especially telecom operators and financial institutions are no longer allowed to access the Aadhaar database for authenticating customers and storing their Aadhaar data.
In fact, they have been ordered to delete all such data.
This has created a new issue for financial institutions and telecom operators: How to verify new and existing customers?
In fact, such is the intensity of the problem, that rumors had started floating in, that 50 crore users of mobile phones can face SIM disconnection issues.
Govt. had refuted these rumors, but concerns remain high.
How Will KYC Work Now?
Industry bodies and businesses suggested offline methods of using Aadhaar to complete eKYC of users: QR Code based Aadhaar verification was proposed as a viable alternative to RBI.
But RBI is still not convinced and wants XML-based Aadhaar extraction, rather than QR Code based Aadhaar verification.
Another official said, “RBI is more keen on starting off with XML-based Aadhaar authentication instead of offline QR code-based verification since the industry is not ready with that offering yet,”
But XML-based Aadhaar extraction can cause some inconvenience to the end users, as the process is somewhat technical, and not every user may be comfortable.
Hence, the concept of a live video recording of the user/customer is now gaining momentum, and we can expect some major announcement regarding this, very soon.
Now, all eyes are set on the new regulations of Prevention of Money Laundering Act, which can have a more detailed overview and opinions on the issue of Aadhaar based verifications.