Introduction

Despite the critical role of the KYC (Know Your Customer) process in ensuring security, the traditional method has often left customers frustrated and hesitant to engage with brands. 

This is when video KYC comes in to save customers a hassle, especially in banking and finance services. Let's explore the impact of video KYC on the BFSI sector and how it streamlines the process.

What Is Video KYC?

It is a modern approach to verifying customer identities (Source: Pxhere).

Video KYC, or VKYC, is an innovative way to verify customer identities. The entire process is carried out via a live video call, eliminating the need for in-person verification. The convenient digital interaction facilitates customer onboarding while guaranteeing the reliability of face-to-face verification.

The fact that VKYC happens in real time adds another layer of trustworthiness. Customers simply provide their personal details and ID documents for review in a live video interview. The bank or institution will then cross-check if the customer's live image matches the photo on their ID.

VKYC has streamlined the BFSI transactions, making them faster and more secure. This boosts the overall customer experience while still maintaining high compliance standards.

The Impact of Video KYC on The BFSI Sector

Speed Up Customer Onboarding

There is no need to schedule in-person meetings or wait in long queues for just a simple procedure. The entire process is now transformed into a quick, time-saving digital experience. With VKYC, you can now verify your identity from the comfort of your home through a live video call. This saves you a lot of time and hassle. 

For BFSI organisations, this increased speed is obviously a game-changer. Faster onboarding means more customers can be verified and approved in less time and, therefore, allows businesses to grow at a better pace. Plus, now that many manual tasks are automated, staff can focus on delivering excellent service rather than being bogged down by paperwork. 

Low Customer Acquisition Costs

Needless to say, traditional customer acquisition is very expensive. Maintaining branches, printing physical documents, employing staff for manual checks, and more - it all eventually adds up.

That's why VKYC is a much smarter solution, as it digitises the entire process. There's no more physical infrastructure or endless paperwork; everything happens online now! 

Businesses can add hundreds or thousands of new customers without stacking up a high cost. This is especially important for large institutions looking to grow efficiently within their budgets.

Improved Time Management

Long waiting times can frustrate customers. VKYC helps optimise how that time is spent. Your customers can complete the verification process whenever convenient, like during their lunch break or while relaxing at home. 

VKYC helps optimise time management (Source: Wiki). 

And on the business side, VKYC frees up valuable time for employees to improve overall productivity (and shorten the lead time from customer inquiry to activation). The result: businesses can manage their time better, operate more smoothly, and issue quicker decisions while still ensuring sustainable growth.

Risk Mitigation

Traditional customer verification leaves room for human errors or fraud risks. With VKYC, the verification happens LIVE. As mentioned above, customers present their ID documents during a real-time video call. You simply need to compare the image on the screen to the ID photo. This nature hinders fraudsters from intervening in between.

Biometric technologies, like facial recognition, are also integrated into the process. They flag suspicious behaviour or mismatches, detecting potential fraud early on. So, you can protect yourself from fraudulent activities without going against regulatory compliance.

Secured Data

Online transactions are prone to security risks, but VKYC offers peace of mind in this regard.

Customer data is encrypted and can't be accessed by a third party. Sensitive personal information, like identity documents, remains safe throughout the process.

Most VKYC systems comply with global data protection regulations like GDPR and CCPA. Businesses can protect their reputation and avoid costly legal penalties, all while reinforcing long-term customer trust/loyalty.

Key Factors to Consider for Successful VKYC Implementation

There are several key factors businesses must consider (Source: Pxhere). 

Selecting the Right Video KYC Solution Provider

The first thing to consider is to find a partner that understands both the ever-changing customer needs and the complexities of your business. To do so, you must look beyond the basic functionality and assess the provider’s depth of experience in the industry. 

In our own experience, an experienced provider must be able to handle a variety of user cases and, most importantly, can offer scalability for growing companies. Specifically, if your business expands, the system must accommodate increased customer demand without compromising on performance. 

There is no one-size-fits-all solution to every company's needs. The provider should offer flexibility to tailor the solution to your specific verification processes or regional compliance requirements.

Integration with Existing Systems and Workflows

Aside from the front-end experience, the VKYC process must also fit into your existing infrastructure. Integrating new technology has never been an easy process, and without a flexible solution, you might create more problems than you solve!

To clarify, deep integration means you ensure the KYC doesn't operate independently but works as part of a cohesive whole. (e.g., real-time sync with customer databases, immediate updating of verification statuses, etc.). A failure to merge these databases not only delays onboarding times but also frustrates and pushes potential customers away, all of which significantly impact the business's bottom line.

Utilising Technology

In recent years, technological advancements have revolutionised the way businesses handle KYC processes. 

Artificial intelligence (AI) and machine learning (ML), for example, are now integral to the evolution of video KYC. They detect and prevent the use of doctored images or pre-recorded videos. Plus, biometric authentication voice recognition, fingerprint scans, etc.) can also be integrated into online video KYC to add an extra layer of security measures. All these techs speed up the verification process much better than ever while still ensuring customers cannot bypass the system.

eKYC by StringeeX - Advanced Solution for Your Business

The StringeeX virtual centre can smoothly integrate electronic identity verification (eKYC) into the business workflow with our Video Call API.

Your team no longer needs to build costly branches to serve customers in far-flung areas; customers can now open bank accounts in minutes without ever leaving their homes! As long as they pass all the stringent verification criteria, they will get instant access to Internet Banking either on the registration page or through the bank's mobile app. Bringing in new customers (while still delivering a standout experience) has never been easier.

Ready to revolutionise your customer onboarding process? Reach out today to discover how StringeeX's video call eKYC can work for your business!

Conclusion

The impact of video KYC on the BFSI sector is undeniable. Without selecting the right solutions and providers for this critical process, you might risk being left behind and losing valuable customers! If you still have questions even after exploring our detailed guide, don’t hesitate to reach out — we’re here to help.