Smart way to man­age KYC

EKYC en­ables cus­tomers to sub­mit their KYC de­tails just once to ODEX and share the same with mul­ti­ple stake­hold­ers. This pro­vides a con­sid­er­able sav­ing in terms of cost and time for all the par­ties in­volved

Maritime Gateway - - Ekyc -

KYC is one of the widely adopted pro­cesses by global busi­nesses and or­ga­ni­za­tions for iden­ti­fi­ca­tion pur­poses. For over two decades now KYC has been used by fi­nan­cial in­sti­tu­tions across the world to set in place a frame­work for cus­tomer iden­ti­fi­ca­tion and for de­cid­ing whom to do busi­ness with. In In­dia, lo­gis­tics in­dus­try has to com­ply with the KYC norms set by statu­tory bod­ies – and thus each stake­holder is com­pul­so­rily re­quired to col­lect, val­i­date and main­tain the KYC of all their cus­tomers.

Over the last 2 years, ODEX has de­vel­oped an EKYC so­lu­tion that en­ables cus­tomers (con­signees, ship­pers, for­warders, agents) to sub­mit their KYC de­tails just once to ODEX and share the same with mul­ti­ple stake­hold­ers (ship­ping lines, NVOCC’S, for­warders, CFS). This pro­vides a con­sid­er­able sav­ing in terms of cost and time for all the par­ties in­volved.

ODEX EKYC plat­form pro­vides self-at­tes­ta­tion of or­ga­ni­za­tion data, dig­i­tal sig­na­ture, doc­u­ment ver­i­fi­ca­tion and third-party ver­i­fi­ca­tion ser­vice pro­vi­sion. Cus­tomers can now con­firm their iden­tity re­motely with zero has­sle while de­liv­er­ing re­quired proof to ser­vice providers in com­pli­ance with KYC reg­u­la­tions.

The chal­lenge

Iden­tity man­age­ment for cus­tomer or­gan­i­sa­tions is a repet­i­tive un­pro­duc­tive ac­tiv­ity. Mul­ti­ple ver­sions of KYC with dif­fer­ent en­ti­ties re­sults in long ver­i­fi­ca­tion time­lines and ex­ten­sive data and in­for­ma­tion shared with mul­ti­ple en­ti­ties. For ser­vice providers it is high ver­i­fi­ca­tion costs – from $10 to $100+ and com­plex and lengthy ver­i­fi­ca­tion process. Stake­holder also have to bear the costs of mul­ti­ple data stor­age in­fra­struc­ture and data man­age­ment costs – a cost that is ex­pected to in­crease sub­stan­tially with reg­u­la­tions like GDPR com­ing into ef­fect.

The so­lu­tion

Dis­trib­uted ledger tech­nol­ogy (based on Blockchain) – has the po­ten­tial to re­duce risks, cut costs and stream­line the KYC pro­cesses com­pletely. ODEX EKYC fa­cil­i­tates the ac­ces­si­bil­ity and or­ga­ni­za­tion of KYC data by lev­er­ag­ing the dis­trib­uted ledgers and the pro­gramma­bil­ity of smart con­tract­ing. In the con­text of KYC com­pli­ance, the to­tal re­sources re­quired for com­pli­ance can be re­duced to the barest min­i­mum.

The sys­tem will have the 3 nodes main­tained by ODEX EKYC plat­form as con­sen­sus build­ing en­ti­ties or val­ida­tors. These three cat­e­gories of nodes are as be­low:

Data is­suers - Own­ers of KYC data. They may or may not be re­garded as trusted en­ti­ties. They pro­vide their KYC/AML data to trusted en­ti­ties in ex­change for an at­tes­ta­tion.

Data val­ida­tors - Re­garded as trusted en­ti­ties. They re­ceive data from is­suers; re­view, con­firm and attest to its va­lid­ity and ex­is­tence. Data con­sumers – Or­ga­ni­za­tions that re­quire the use of KYC data. They re­view at­tes­ta­tions, de­ter­mine us­abil­ity, and re­quest Data from hold­ers.

Data en­tity

The sys­tem will store all the rel­e­vant hash of de­tails of the fol­low­ing in the Block Chain (not all may be ap­pli­ca­ble, and more may be added to the list):

• Or­ga­ni­za­tion Name & Type of busi­ness

Ad­dress

Com­pany Num­ber De­tails

Tax De­tails (PAN & GST)

Im­port Ex­port Code

MTO Li­cense

CHA Li­cense

Data Con­sumer Ac­cess

It is rec­om­mended that data is­suers at­tach scans of the KYC doc­u­ments is­sued by reg­u­la­tory au­thor­i­ties, and dig­i­tally signed by the data is­suer. The ap­pli­ca­tion is in pilot phase and will be made live soon.

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