Fin­tech in­dus­try weighs Ai-based so­lu­tions for E-KYC


and the Se­cu­ri­ties and Ex­change Board of In­dia (Sebi) for ap­proval,” said the first per­son cited above.

Pri­vate com­pa­nies have been un­able to carry out Aad­haar-based E-KYC af­ter the Supreme Court’s de­ci­sion on Septem­ber to bar pri­vate com­pa­nies from ac­cess­ing the Aad­haar de­tails of con­sumers.

This has also af­fected their busi­ness. Con­sumers, too, have no clar­ity on how to com­plete the ver­i­fi­ca­tion process with­out Aad­haar.

The Ai-based ap­pli­ca­tion be­ing con­sid­ered will help cus­tomers send their iden­tity proof over the web, en­abling their fa­cial im­ages to be cap­tured by the app from dif­fer­ent an­gles to en­sure live­li­ness. (Live­ness is the abil­ity to check whether it is a pho­to­graph be­fore the cam­era or an ac­tual hu­man be­ing), ac­cord­ing to the sec­ond per­son men­tioned

Authen­ti­ca­tion mod­els un­der study ear­lier.

Video-based KYC is also be­ing con­sid­ered as ad­di­tional authen­ti­ca­tion where a video will be recorded by the app to en­sure live­ness, said this per­son.

The pay­ments in­dus­try is look­ing at dig­i­tal al­ter­na­tives as it is not pos­si­ble to do phys­i­cal ver­i­fi­ca­tion on a mass scale, ac­cord­ing to the sec­ond per­son cited ear­lier.

In an off­line model, phys­i­cal doc­u­ments sub­mit­ted by a cus­tomer are shipped by the firm to the ver­i­fi­ca­tion cen­tre and the cus­tomer is called up to cross-ver­ify de­tails, a process that takes 24-36 hours.

Also, the cost of authen­ti­ca­tion might go up from ₹15 per per­son, which is the cur­rent cost of E-KYC ver­i­fi­ca­tion, to ₹100 per per­son for a phys­i­cal KYC.

A five-mem­ber Con­sti­tu­tion bench of the Supreme Court had on 26 Septem­ber barred pri­vate com­pa­nies from ac­cess­ing Aad­haar de­tails of con­sumers.

This af­fected tele­com op­er­a­tors, wal­let com­pa­nies, banks and fin­techs who had been us­ing the bio­met­ric database for in­stant elec­tronic ver­i­fi­ca­tion of would-be sub­scribers. These firms have stopped us­ing Aad­haar for authen­ti­ca­tion, in light of the Supreme Court or­der.

“The idea is good. How­ever, we’ll have to see how peo­ple are able to adapt to these meth­ods. It is also im­por­tant to note that these com­pa­nies have al­ready in­vested heav­ily on set­ting up the Aad­haar(rbi) based KYC in­fra­struc­ture and now ad­di­tional in­vest­ment would be needed to set up the new in­fra­struc­ture,” said Ashish Ag­gar­wal, se­nior di­rec­tor and head of pub­lic pol­icy at Nass­com, the IT in­dus­try lobby.

Ear­lier this month, the depart­ment of telecom­mu­ni­ca­tions and the Unique Iden­ti­fi­ca­tion Au­thor­ity of In­dia pro­posed a new mech­a­nism, a mo­bile ap­pli­ca­tion with a one-time pass­word, for in­stant ver­i­fi­ca­tion of new mo­bile phone sub­scribers.

The new process will in­volve pho­tograph­ing cus­tomers with lo­ca­tion and time stamps, and will also re­quire them to sub­mit iden­ti­fi­ca­tion doc­u­ments.

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