WHITEPAPER
MANAGE IN-PERSON KYC,
REMOTELY
Know Your Customer (KYC) regulations typically require face-to-face
confirmation by a bank employee. But social distancing requirements
are challenging banks’ ability to onboard new customers this way.
Videoconferencing can help, and one Indian startup has developed a
specific tool for the purpose.
KYC regulations require financial
services providers to identify the
Video KYC for the Signzy aims to resolve just that. It
offers a safe and secure IPV process
customer, verify their authenticity COVID-19 era using videoconferencing. But that’s
and understand what their sources of not all. Signzy also integrates its facial
That’s where fintech startups such
income are. This helps the institution recognition and document detection
as Signzy are helping. “In the past
manage risks, protect stakeholders technology with video IPV, a KYC
two months, we have had a big spike
and protect against money laundering. capability that solves the need for
in queries, and we are starting to
Apart from verifying a customer’s ID human interaction that had remained
win implementations at banks that
proofs, a critical component of KYC unresolved for a long time. This allows
previously weren’t interested,” said
is a face-to-face meeting with the a bank representative to talk the
Ankit Ratan, CEO of Signzy, which is
customer. This in-person verification customer through the process and
trying to revolutionize digital KYC. The
(IPV) helps authenticate the customer verify their details in real time while
2015-founded firm recently released
and establishes a sense of trust. the technology corroborates the data
a sophisticated videoconferencing
with the appropriate government
However, with a pandemic such as solution tailored to KYC that can be
agency. What’s more, it provides these
COVID-19, a face-to-face meeting used by banks that suddenly have
features in a secure and encrypted
puts both the customer and the a lot of staff working remotely but
environment.
representative at risk. Meanwhile, are under pressure to complete KYC
banks are seeing a massive surge checks. The remote video KYC incorporates
in new small and medium-sized optical character recognition-driven
enterprises and private customers data capture that reads the ID proofs
looking for financial services — mainly In-person while its AI-driven rule engine runs a
loans — to help them through the
lockdown. Investment institutions are
videoconferencing real-time compliance check against
government databases. To prevent
also looking to attract new investors Customer onboarding for banks fraud, Signzy has put in place multiple
as global financial markets have includes two components: verification checkpoints. The engine checks the
shrunk between 10% and 30%. Yet of a customer’s documents and customer’s IP address for any proxies
with lockdowns and social distancing data, and IPV. While there are many or blacklisted IPs and helps geo-tag
norms expected to be in place for an companies and technologies that the customer’s location to ensure
extended period, meeting a customer verify the former with government that the customer is not spoofing his
to complete the in-person KYC check is databases, banks and regulators have or her location. The forgery check
nearly impossible. struggled with IPV checks that rely on authenticates a signature’s validity,
face-to-face interaction.
Figure 1. Customer journey during video KYC process
Signzy front-end application
Customer shows
VPN check ID card
Brightness Video-call RM captures
Customer Request or check screenshots
Application initiates Applications
Customer visits captures/uploads schedule a Bandwidth marked as safe
link RM asks few
client portal image of ID card video call check and genuine
(Website/Mobile app) questions
Application
completed
Confirmation Signzy back-office dashboard Signzy back-office dashboard
Time and date
stamp
Accept
Intimation to Core systems
customer Reject Accept/Reject View data and Forgery Details AI-based
applications status of check cross-matching face match
applications
Rejection reason
RM - Relationship Manager
Source: Signzy
External Document © 2020 Infosys Limited
while image forensics verify the
authenticity of the ID proof.
Workflows that save instruction flow is available to the
customer via email, SMS or WhatsApp,
To reduce remote video KYC frauds or time, effort and money providing information at their
convenience. As a result, institutions
spoofing, such as video editing or 3D Signzy allows banks to create
have seen a 50% decline in customer
masks that can mimic an individual, workflows and onboarding journeys
drop-offs, according to Ratan.
active and passive “liveness” come into over a videoconference. It provides
play. Active liveness detection includes onboarding steps to the customer
responses to queries or actions posed while the video is live, offering the Signzy has reduced the life cycle
to customers. For example, as a safety customer a seamless passage through of physical KYC process from 10
measure, the platform can pose the KYC experience. A checker allows
random questions to the customer
days to just four hours
each step to be completed before
by employing a random sampling moving to the next one. With over
algorithm. The institution can choose The platform allows representatives
150,000 customers onboarded each
to add any questions that are required, to converse with a customer, verify a
month by Securities and Exchange
that allows the institution to balance customer’s details, take a screenshot,
Board of India-regulated (an Indian
security and user experiences. On receive customer consent and share
securities regulator) institutions, the
the other hand, passive liveness documents at the same time.
platform keeps the customer at the
provides a frictionless experience to forefront, enabling an onboarding The life cycle of the physical KYC
the customer, since this is a process experience that is simple, quick and process can take between eight and 10
in which only a customer screenshot hassle-free. Its smart queuing platform days, but with Signzy, that time period
is examined and a short video is offers customers a convenient and falls to just four hours. This leads to
captured. Signzy enables audit trails planned verification method over efficiency being tripled while lowering
and a time stamp on all images and mobile or the web. Signzy uses iFrame the cost of customer onboarding by
videos that can be used for future to integrate with a web or mobile an astonishing 65%. More importantly,
reference. application without disturbing the digital fraud can be reduced by 75%.
customer’s journey. A step-by-step
Figure 2. Signzy’s video KYC is more automated, sophisticated and 98% faster than the traditional process
Traditional process of KYC
Physical/digital Photo-copy of Submit physical In-person Send physical KYC
manual form ID proofs documents to AMC verification documents for KYC approved/rejected
8-10 days
Improved process of KYC
Digital Image of Upload other Signature Photo and video Submit AI & ML Application at Action taken Application sent KYC approved/
form filling ID proofs documents upload capture documents to AMC algorithms backops with scores by AMC to KYC agency rejected
8-10 minutes 35-40 seconds 4-5 minutes
AMC - Asset Management Company
Source: Signzy
External Document © 2020 Infosys Limited
The fintech’s real-time verification all applications are released after quick turnaround, he recommends a
solution saves time for institutions and internal and third-party vulnerability coordinated effort in three areas:
customers. The AI engine immediately assessment and penetration tests are 1. Information security
matches the customer’s face with the complete.
Compliance and information
one on the presented ID. Meanwhile,
These additional layers of AI, workflow security teams should be involved
the queuing mechanism helps
and security are what Signzy’s to begin a process approval as
representatives manage multiple
spokespeople say sets the company early as possible. As on-premises
applications simultaneously.
apart from its competitors. deployments will be difficult to
execute in these times, it would be
AI-built technology Moving from a domestic ideal to have all the requisite cloud
deployment approvals in place.
stack to a global market Remote-working information
Signzy’s technology stack is heavy security policies also need to be
Signzy is already an established player
on AI, and it has also created a in place for customer-related
in India, where the banking and
proprietary intelligent engine, VEVA, interactions.
investment regulators have approved
that processes data captured during 2. Application
its product and where it is one of
the videoconference and performs all The current situation makes
the largest players. Over 90 Indian
the fraud and IP checks. VEVA helps it difficult to carry out new
clients, including banks, insurers,
prevent static photo and prerecorded integrations to current
asset management companies and
video attacks, using facial passive and applications. Ratan suggests
non-bank financial corporations, use
active liveness to prevent spoofing. working in two phases. Phase 1
Signzy’s video KYC. KYC has been
The AI engine also validates the will include the current state, i.e.,
heavily regulated in India, yet digital
video, verifies the customer’s ID and a workflow that feeds into other
KYC has significantly scaled here.
detects its orientation using machine applications manually. All new
And COVID-19 has increased its need
learning algorithms. AI algorithms run integrations will be carried out in
— customers that were previously
on the ID card images to detect their phase 2. He also suggests going
unwilling to move to digital KYC have
authenticity by reading pixel layers live as soon as possible on the
now quickly embraced it.
and generating heat maps. cloud, with minimal integrations
Signzy is looking to expand in the
Financial institutions are known to and moving to an on-premises
American, European and Middle
be finicky when it comes to security, integrated stack later.
Eastern markets. According to Ratan,
and with good reason. To secure data 3. Operations
regulators in Qatar, Oman and the UAE
in motion, Signzy uses a cipher TLS Training and IT support to
are more open than before to allow
1.2 channel encryption with a 2048- resolve issues and educate
remote onboarding of customers.
bit RSA key over a SHA-256. LVM employees must be in place.
Ratan also expects strong growth
disks are used to host any block store Audit requirements may change
in the American market and has
files to ensure the platform is secure as video recording of the entire
already gone live in the country with
and scalable for high-throughput process is available. The need
Mastercard.
algorithms. Database hardening is for the four-eyes principle is
done per industry standards, and In Signzy’s favor is the ease of
therefore lost. For example,
access rights are given only to the implementation of its product.
an employee in charge of KYC
right people. Unwanted personally The CEO, Ratan, claims that
verification for onboarding will
identifiable information can be the implementation cost of
spend less time for IPV because
deleted, as Signzy has activated videoconferencing is low, and the
of the AI-driven audit trails.
the Time to Live (TTL) feature on steps are quite simple because of its
Checker audit processes can be
file storage that deletes unwanted plug-and-play feature and platform-
applied programmatically on the
personally identifiable information. agnostic support. In fact, for some of
video recording. This cuts down
On-premises products are deployed its Middle Eastern clients, Signzy set up
the need for an extra step and
as containerized applications that the basic infrastructure in a mere 2-3
improves the turnaround time.
are compiled, tested and security- days. He also indicated that institutions
hardened to form deployable that have a cloud presence can go live
docker images. Signzy ensures that much more quickly. To achieve this
External Document © 2020 Infosys Limited
Tip of the • Rethink: How current job
descriptions and duties can be
COVID-19 has certainly caught
institutions off guard. The current crisis
transformation spear readjusted to adapt to new digital will force them to act faster and think
processes. more about implementing digital
Whether they are prepared or
• Reskill: Training employers to solutions in the future. As the current
not, institutions adopting digital
equip their employees with the COVID-19 situation evolves, financial
onboarding will have to undergo
skills needed to perform new roles institutions the world over are more
significant organizational changes. It’s
required of them. likely to adopt platforms created by
not just a matter of adding video KYC;
companies such as Signzy that can
rather, a complete reevaluation of the • Redeploy: Moving employees with
help digitally onboard customers
operating model within the bank is specific skills to other parts of the
and satisfy KYC requirements swiftly,
in play. CEO Ankit Ratan thinks that, organization where their skills will
securely and cost-effectively.
broadly, the organizational structure be more appropriate or useful.
will require changes around:
Authors
Mandar Joshi Abhik Kar Sharan Bathija
Senior Industry Principal, Financial Services Principal Consultant, Financial Services Infosys Knowledge Institute
Mandar.Joshi04@infosys.com Abhik_Kar@infosys.com Sharan_BP@infosys.com
External Document © 2020 Infosys Limited
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