Knowing Your Customer (KYC) is defined as being a “standard due diligence process used most often by financial companies to assess and monitor customer risk and verify a customer’s identity.” In short, KYC ensures a customer’s identification and that they are actually who they claim to be. There are a number of tactics companies can use to implement KYC processes including, but not limited to: biometric verification, face verification, or the most commonly used means – ID card verification. Knowing Your Customer is a critical set of procedures to suss out the various customer risk(s) that businesses face on a daily basis.
In the last few years, KYC has become increasingly essential to financial institutions as fraud (especially digital fraud) is now rampant and widespread. We have recently entered an era of “open banking”. In this new ecosystem, KYC onboarding has become extremely sophisticated in terms of automation. AI combined with human data can help businesses dramatically ramp up both the speed of their customer onboarding process and also give specificity/tailored insights into each customer. Customization will continue to play a significant role in KYC as it continues to modernize.
In summation, KYC is a critical component to improving CX even beyond financial institutions. The way technology and humans are working together to assess customer data is changing by the minute. The results of KYC are win-win for both businesses and customers as this framework helps mitigate customer risk and also the process instills greater customer confidence and trust.
The fact is KYC is one of the main challenges in businesses in many different sectors. Our team at Horatio is proud to have recently announced that we will be extending our services and providing KYC expertise for our clients. In melding cutting-edge technology with input from our high-touch agents, we will collectively strive to stay at the forefront of KYC processes and procedures for all your business needs.