The Revolution of Reusable KYC
KYC has been around for a number of years now and though there have been many improvements in technology that have simplified and sped up the process, it is only in the past few years that developments have been possible that transform the experience from one of frustration and waiting to one of quick and easy compliance.
The main ability that has led this charge to revolutionize the KYC process is the capability to enable reusable KYC. Before reusable KYC, each time a person wanted to interact with a new financial institution (or other business that came under the jurisdiction of KYC regulations), they had to dredge up the required documents, fill out the same paperwork (either physically or electronically) and wait as the business in question either checked their identity in-house or sent the data off to a company that would perform the KYC checks for them. These processes took a while to complete - moreso if the KYC was done in-house in an attempt to reduce costs by smaller or start-up companies (which also put a legal risk on those which had to rely on this method). Even in major financial institutions, the process could be expected to take weeks to be resolved. Whilst this may not have been ideal for some customers or potential investors, for others who were looking to become involved in time-sensitive opportunities it meant the difference between enjoying and missing out on a lucrative investment. This was perhaps felt nowhere so keenly as when the ICO boom happened. With the huge demand for KYC and the limited time people had to invest in new opportunities, many found themselves stymied by the slow process. Previously, as the check had to be performed each time a new customer wanted to onboard, or someone who had been through the process before wanted to use a new merchant, KYC was also an expensive process, with employees having to devote time to interviews and KYC checks. Documents might also have been sent to third parties to undergo KYC checks; however, as each person was only likely to onboard to a specific company only once, this represented a huge inefficiency. Before reusable KYC , conducting compliance in this manner was found to have cost up to 20% or even more of a bank’s running costs. With the growth of cryptocurrencies and blockchain, attitudes and solutions slowly began to change from centralised, business-centric methods, to decentralized, user-centric methods. This has revolutionized a number of industries, but the KYC applications in particular were a prime target to see benefits from a new model. In conjunction with new and secure cryptographic capabilities, and the propensity of people to use mobile devices (and the growing market saturation of mobile devices), a revolutionary reusable KYC solution was possible. In this new method, reusable KYC was able to be implemented if the user completed the KYC process once and the result of this could be cryptographically proved and stored on their mobile device. Once a user had completed KYC and could prove it, they could then share that proof with any merchant who required it instantly - without going through the entire process again. The cost of KYC was therefore reduced dramatically as the same person no longer needed to be verified multiple times, and as the time that was taken to set up and carry out KYC only needed to be completed once, the wait for the user and business was likewise minimised. This is precisely the approach Blockpass has taken in our KYC Connect solution. Anyone can download the Blockpass Mobile App and create their own identity profile before having it verified, completely free of charge. This means that a user can have their KYC ready to go when they want to onboard with a merchant at the click of a button - useful in saving time in every situation but particularly in time-sensitive opportunities. With the huge efficiencies that Blockpass’ approach creates, KYC services can be offered to merchants at a fraction of the cost that they would have expected to pay with previous methods. In addition to this, merchants also don’t have to wait for the KYC process to be completed either - if a user has a verified identity already they are ready to onboard straight away! Finally, an important benefit of this model and reusable KYC is that the user is in charge of their own personal information and data; they chose which merchants to onboard with and can decide based on the information required - giving them back control of what is their own data, rather than handing over control of it to a company. The Blockpass platform is fully automated and hosted in the cloud, with no integration or setup fee. Businesses can sign up to the KYC Connect console in a matter of minutes, test out the service, and start conducting identity documents verification, KYC and AML checks. Sign up for FREE at console.blockpass.org.