Identity theft happens when someone steals your personal information like Aadhar card number, PAN details, or credit card information to make an online purchase, access your financial accounts, create a new bank account, or commit any other type of fraud.
Identity thefts are far more common than you think. According to Norton Cyber Security Insights 2021, nearly 2.7 crore Indians were affected by identity threats in 2020 – that is, 45% of adult Indian internet users. With such high levels of risk, financial institutions need to re-evaluate their current KYC processes to reduce instances of fraud while engaging with new customers. As instances of fraud will see an upward trend, it is time for financial institutions to opt for secure Digital KYC processes in place of legacy practices.
Before we understand how to reduce risk, let us know how one becomes vulnerable to identity theft.
- Unsecure and public browsing: For the most part, accessing the internet is safe. But, unsecured websites and public Wi-fi increase the risk of data, landing into hackers’ hands.
- Data breach: A data breach is a security incident where sensitive information is accessed without authorisation. This year, personally identifiable information of 5,00,000 Indian police personnel was hacked into and put up for sale online, which was traced to a police exam conducted in December 2019.
- Malware activity: Malwares are malicious programs that perform several functions like stealing, altering code, hijacking, deleting sensitive data, and encrypting.
- Phishing: In this type of attack, a fraudulent communication appears to come from a reputable source, which, when clicked on, lands data in identity thieves’ hands.
- Physical theft: Sometimes, losing a credit card or mobile phones makes data available at ease, to thieves.
- Card skimming: In credit card skimming, thieves use a small device to steal payment card (credit card, debit card or ATM card) information. When the card is swiped through this device, it captures all the data from the card’s magnetic strip.
Digital KYC to Address Identity Theft
KYC (‘Know Your Customer’ or ‘Know Your Client’) is a process by which institutions verify the identities of their customers to gauge their identity and credibility. Banks, insurance companies and financial institutions heavily rely on KYC before opening a new account.
Identity verification with KYC mainly addresses identity theft. Despite RBI guidelines for KYC, forged documents and financial fraud continue to be a problem. Recently, in Delhi, a group of fraudsters cheated several popular banks and utilised 22 PAN cards, 9 Aadhar cards, and 21 voter ID cards for their operation.
The current KYC processes are heavily dependent on outsourced vendors and are susceptible to both customer and employee fraud. Kwik.ID provides both Digital and Video based KYC identification to address the issues that KYC processes currently face. Our Video KYC process is used for customer identification as mandated by RBI, SEBI, IRDAI, and PFRDA. The process uses end-to-end encryption for maximum data security and prevents your risk of breach or theft with an on-premises setup.
We verify all officially valid documents (OVD) like PAN, Aadhar, Driver’s License, and Voter ID card from the Central Government Database using our Digital KYC offering. Using Optical Character Recognition, our software recognises characters in ID documents within seconds. Besides incorporating security questions to verify details, AI-enabled image processing is an integral part of our Digital KYC process.
We establish identity consistency by comparing user images on selfies, institutional photographs, and photograph on official ID. We also detect liveliness using AI with live-action commands. Both these steps together significantly minimise instances of fraudulent customers.
Get in touch with us to know more about our streamlined Digital and Video kyc process – we can customise a solution based on your requirement.