According to the World Bank, billions of online customers still require verification, despite issues caused by the worldwide pandemic. Consequently, customers cannot access essential services, like
- Healthcare Facilities
- Social Security
Though they seem like baseless worries, they are not. These issues have drawn people’s attention to increase awareness of financial instability. They raised the point that financial companies need significant improvements and efforts to find answers. All businesses must embrace online KYC Verification to provide error-free customer service and make a strong base of the pyramid.
Financial executives and entrepreneurs can opt for more reliable, advanced, and socially acceptable techniques. It will also help financial leaders indicate that they prioritize their customers over profits and provide flexibility in unpredictable times.
Importance of KYC Online Verification in Financial Inclusion
Financial inclusion ensures people access to every financial service. Hence, promoting financial inclusion entails services suitable for economic goods.
Digital Financial Inclusion Gap
With resolving online hurdles, financial inclusion is vital and beneficial. The absence of digital systems and services generates gaps in financial inclusion. Because monetary advantages are now available at lower costs, they travel farther and move smoothly, thanks to technological advancements.
Identical to having banking insurance, an external banking service secures companies from suspicious economic systems. With an international investment account, companies should avoid baseless lawsuits. Amount in offshore bank accounts simplifies money management. With e-KYC, opening an offshore or international bank account is more straightforward than a new employee’s onboarding procedure.
Another element of financial inclusion is that regardless of their financial status, people have the right to access all insurance services. However, these goods and services were only accessible through physical verification previously. Moreover, customers must rely on modern methods such as video conferencing and provide documentation through online KYC authentication.
These activities reduce customers and insurance businesses. The customer onboarding process gets slower as employees must manually fill out paperwork for each client. Thus, it is one of the significant issues, and organizations risk losing genuine customers.
Financial Inclusion Problems
Digital financial services provide a remarkable opportunity to improve economic distribution services to more people. According to ITU research, only 4 billion people have access to the internet, meaning that billions of people cannot even connect to the internet. Therefore, it implies that online settling financial matters will take some time.
Credit Card Providers
The onboarding process for a credit card is challenging and time-consuming for financial inclusion due to complex procedures. Moreover, credit card companies and providers have payment-free processes. However, their strict guidelines make the customer leave thinking that these services are not valuable.
The utilization of paper-based and old documentation stops automation in the ID procedures. Credit card companies rely on and must ensure compliance with online KYC verification, easing the onboarding procedures.
Manual paperwork takes a lot of time for everyone, including lenders. Moreover, these time taking processes significantly affect performance and customer experience. Loan lenders must conduct online KYC verification and anti-money laundering checks to ensure that their customers are not breaking anti-money laundering laws.
Through identity theft and exploitation, crooks and scammers can control banks and other loan providers. The fraudsters only need a person’s SSN (Social Security Number) and manipulation of their actual and legal identification documents to get big loans. Once they file for loans and get a response, loan lenders can monitor and verify the loan—moreover, cybercrimes and hacking damage lenders’ finances and companies’ credibility.
KYC Online verification solutions are becoming increasingly popular, making it easier for financial companies. Moreover, digital identity authentication has simplified customer onboarding and assisted companies in compliance with strict anti-money laundering and know-your-customer standards.
Additionally, it has produced a favorable environment for overcoming fraud, which has been prevalent for decades. Because of eKYC, financial companies have been able to create modern techniques to combat fraud.
Online KYC verification strives to provide financial inclusion to the vulnerable population while setting reasonable expectations for people and enterprises. These essential services raise profit goals while upholding higher standards of conduct. Therefore, governments must bring uniformity in laws and carry out advanced investigation and monitoring teams.