What is KYC Authentication?

 

KYC authentication has become a vital part of getting important services these days, like getting a gas or LPG line or even buying an insurance policy. The main aim of conducting KYC is to verify the identity of clients and examine the probabilities of any illegal wrongdoings. Another reason why almost all major companies and organizations are carrying out KYC is to ensure their distributors, consultants, and agents are bribery-free and are not involved in any unlawful activities.

In simple terms, KYC can be understood as an algorithmic and automated verification method that can be leveraged by financial and non-banking financial institutions to accurately verify the identity of a customer. In full, KYC stands for Know Your Client and Know Your Customer, and today more than 80 countries across the world have standing instructions on how as well as why KYC procedures should be leveraged to verify the identity of a customer.

The idea behind KYC as a computer driven technology is quite simple. The KYC algorithm collects data on a customer from various sources, ranging all the way from government issued identification documents to utility bills, in order to assess whether the claim of the customer in regards to their identity is accurate or not.

Before this verification process was very popular, institutions mostly relied on manual background checks as well as unchallenging good faith techniques to verify the legitimacy of a customer. In doing so, they risked the institution to potential fraud or undue participation in terrorist activity.

But, the increase in popularity of this technology on a global scale has made institutions across the globe to leverage it to not only protect their business from fraudulent activities, but to also accurately estimate the risk model that they should employ for specific customers.

For more information on KYC authentication, visit our website at https://loginid.io/

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