By Marwan Elnakat, Digital Banking Sales CISMEA at Gemalto
Digital technology and a new generation of consumers are redefining traditional banking and financial services, with the rate of change set to accelerate even further. Millennials have grown up in a world of 24/7 mobile connectivity and consequently their expectation is typically one of instant, one-click fulfilment.
But the challenges for the financial sector do not stop there. Authorities around the world are responding to threats such as money laundering, identity theft and the flow of finance to support terrorism by implementing far more rigorous regulatory frameworks.
Central to many of these is the imposition of more stringent requirements on banks and other financial service providers to deploy efficient Know Your Customer (KYC) and Customer Due Diligence (CDD) procedures during enrolment.
For long-established institutions and FinTechs alike, the scale of the task should not be underestimated. Quite simply, rigorous compliance with the latest legislation must be combined with swift, accessible and seamless end-user experience.
An outdated approach to enrolment still dominates the banking sector
To date, enrolment has remained one of the few banking processes left largely untouched by digitalisation, especially in the Middle East region. Typically, it still requires the customer to visit a branch in person, join the queues, and undertake a laborious manual process. Certainly, it is far removed from the expectations of a new generation of consumer that is rapidly abandoning ‘bricks and mortar’ banking in favour of anytime, anywhere mobile and digital services.
But manual enrolment is not just unattractive to customers. For banks, it is costly and inefficient. Preparing branch staff to reliably and consistently verify ID documents visually, compare the customer’s face with the picture on their credentials, then physically input all their personal details into the system is a major burden. Not only is it time-consuming, but also vulnerable to human error and fraud. Even if it is performed faultlessly, it is hardly likely to deliver the seamless journey that every bank should now aspire to.
A simple and seamless customer enrolment with a multi-channel solution
ID Verification solutions that encompass a suite of solutions drawing on the latest biometric and document authentication techniques to automate KYC and enrolment procedures swiftly and effectively is what is needed in order to streamline the digitalisation process. Banks and other financial institutions need to have options that can be deployed in-branch, in self-service kiosks, or online. In all cases, service providers should have the option of employing proven and familiar biometric authentication techniques, and additional customer risk assessment using PEPs, sanction and watch lists.
For consumers, the contrast with long-winded manual procedures could hardly be clearer. For example, with ID Verification Online, one of Gemalto’s solutions, the end-user starts the journey by simply taking a picture of their ID document (passport, ID card, driver license etc) with their preferred connected device, then uploading it to Gemalto’s server. Here it is instantly checked against the world’s largest database of official ID document templates to confirm it is genuine.
Next the customer uploads a selfie. This is automatically compared with the picture on the ID, in real time, using Gemalto’s advanced facial recognition systems. Finally, Gemalto’s multi-channel ID Verification captures the personal details on the customer’s ID document and uses them to instantly fill out the enrolment form. Precious time is saved for the customer, and the risk of a mistake being made is all but eliminated.
The reassurance of familiar and intuitive processes
Across all these solutions, the techniques employed are tried and trusted by consumers. Over recent years, leading smartphone manufacturers have quickly popularised biometric authentication. Similarly, the concept of the selfie is now part and parcel of popular culture. Every step of the process is familiar, intuitive – and fast. Furthermore, the benefits of this swift, accurate approach to enrolment are not limited to the financial sector. A myriad of organisations and enterprises stand to benefit from rapid verification of new users’ identities, ranging from mobile network operators to healthcare providers and government bodies.
Proven and recognised the world over
For the financial sector, stringent regulation is now a fact of life. Fortunately, there is widespread evidence that consumers expect – and indeed welcome – measures that address threats such as cyber-crime, ID theft and money laundering. However, the demand for outstanding service and accessibility remains equally strong. Solutions now exist for both public and private sector organisations to implement enrolment solutions that do more than simply minimise the inconvenience of complying with KYC obligations. By embedding these new tools into their wider digitalisation programs, banks and other service providers can deploy another asset in the quest to acquire and retain new customers, helping to build long term market share and profitability in the years ahead.