For companies around the world, complying with a myriad of regulations is an everyday reality. At the outset of every new relationship or customer account, Know Your Customer (KYC) regulations take front and center.
Designed to protect against fraud or criminal activities such as money laundering or terrorist funding, compliance with KYC rules begins with knowing who you’re doing business with. That includes both individuals and legal entities.
Identity verification requires having sound customer due diligence processes in place for checking identities and credentials. But in a world that’s increasingly digital, mobile and globally connected, how does a business truly “know” who they are dealing with and how can they take advantage of the tremendous online commercial opportunities while avoiding risks and penalties?
Trulioo CEO and founder Stephen Ufford sat down for a conversation with PYMNTS.com President Karen Webster for a Beyond the Buzzword podcast to discuss challenges in today’s identity space and how our modern technology can offer solutions to better know your customers.
Emerging and Converging
As Stephen explains, things were very different in the past. Before the emergence of online and mobile business, verifying a customer or new account at the time of creation was an in-person experience requiring checks on physical documents. Proving an identity online, though, is altogether different.
With billions of consumers spread across the globe - many with access to a mobile device - there are a vast array of opportunities to quickly scale a business and serve a global audience. Yet, there are challenges – especially in meeting KYC regulations.
In the podcast, Stephen notes the rapid pace of innovation in the identity space over the past five years, with technology and mobile access and adoption driving much of that. While data has always been a part of KYC, the enormous volume of data created from digital engagements can be overwhelming, but it is becoming invaluably helpful for building and proving identities online. This is especially true when it comes to mobile technology.
What Mobile Knows
“There is no silver bullet solution that will solve all of the world’s identity issues,” says Stephen. With different cultural norms and identity processes and procedures around the world, that’s been a reality long before the dawn of the internet. But mobile technology represents a new opportunity to open new markets, validate new customers and reduce fraudulent activities.
The use of mobile is nearly universal and has rapidly changed the way people connect and engage. Even in countries, regions or populations that have weak or limited identity records, including government-issued identities or traditional data sources such as financial institution or credit bureau information, the mobile device is prevalent.
“Because the mobile device has been so widely adopted – 5.5 billion people with a mobile device – it’s very, very hard to find any type of concept yet alone any working solution in the world that has that kind of scale,” says Stephen. “Mobile carriers know us very well – who we are, where we are – they allow us to leverage that for our own use to prove who we are, when we want to, and this can be a scalable solution.”
The data in the hands of mobile network operators (MNOs) represents an enormous opportunity to help build identity profiles for people around the world, creating a smart and effective use of this data for verifying identities and meeting KYC compliance measures.
Earlier this year, Trulioo launched the world’s first mobile Know Your Customer (KYC) solution, MobileID. Offering access to dozens of the world’s largest MNOs, Trulioo helps businesses meet global KYC requirements and reduce fraud by powering verification of mobile users worldwide.