HOW BLOCKCHAIN CAN BE USED IN KYC & HOW IT WORKS?
Know Your Customer (KYC) processes require any business firm to validate and verify primary documents as part of due diligence. Currently, KYC utilities that help manage these documents and share them with multiple entities flood the markets. In some cases, these services may even perform due diligence.This KYC process can delay business as it can take 30 to 50 days to complete to a satisfactory level.
Know your customer processes are also employed by companies of all sizes for the purpose of ensuring their proposed agents, consultants, or distributors are anti-bribery compliant. Banks, insurers and export creditors are increasingly demanding that customers provide detailed anti-corruption due diligence information, to verify their probity and integrity.
Role based participation — allow users of different roles to query or update different attributes of a record. Roles: Consumers Telecom company/Bank Government Authorities User Stories:
User Story: Consumer submits the documents needed for KYC procedure to the branch. The documents are verified, originals sighted and scanned. As there is no record for the consumer in the global KYC database the data and images are uploaded, the record is created and the consumer is given a key to his record. Telecom company/Retail Bank now has read only access to the identity record and write access to update consumer’s risk profile.
User Story: Consumer identity data the consumer already has in the global KYC database. Consumer fills out an application on Mortgage Bank’s website and invokes a procedure similar to third pary _login with_ which opens a window hosted by the KYC server prompting consumer which attributes of his record to share with Mortgage Bank.
User Story: Regulator queries the ledger to check if Mortgage Bank followed KYC procedures for Consumer.
User Story: Retail bank sees unusual activity in consumer’s account and updates consumer’s record in the KYC database with a risk flag.
User Story: Consumer refinances his mortgage: he applies on another mortgage bank’s website, allows to share his identity data and at the same time revokes the access by the original Mortgage Bank.
User Story: Consumer asks Government Authority to verify and _stamp_ an individual document uploaded to the KYC database as valid. Authority has write access to add an attribute marking this particular document as valid. Authority verifies the document against their own database.
User Story: Regulator creates requirements for an identity record to bear a stamp of approval: a certain number of documents need to be stamped by Authorities. Consumers can build up reputation by having their KYC record endorsed by trusted parties.
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