The world is becoming more connected every day. And as we connect, businesses must keep up with the latest trends to stay ahead of the competition.
It can happen by using recent developments in Computer Vision and Deep Learning technologies to find out more about their customers before meeting them in person. With these advancements, organizations can now scan documents or take pictures of faces just by using a webcam – without requiring any additional information from the customer.
It means that companies can offer better services while also keeping their costs down at the same time! What other ways could you use new technology like computer vision and deep learning to improve your business? Think outside of the box and explore what new possibilities are available to help you continue being successful.
The future is here, so be sure not to get left behind… Know Your Customer!!!
Table of Contents
- What is KYC (Know Your Customer)
- How does KYC work
- Why do organizations use KYC
- Benefits of using KYC
- Implementing a successful KYC program in your organization
What is KYC (Know your customer)?
A KYC or know-your-customer is a due diligence process that companies, especially banks and financial institutions, use to identify their clients. It is an approach to systematically classify customers based on the probability and severity of the customer’s default. This classification can be done with the help of different models, which are divided into four main categories.
For example, there is the scorecard model in which the customer needs to fill out a form. There are also expert rules that consider age, persistence, etc., and behavioral practices that apply a set of selected questions from a rigid list. The most advanced and preferred method is the statistical model that includes more specific information such as income, occupation, and location when determining the risk for default.
Note: Other NLP techniques like Word Embedding and Term Tagging are also used within KYC applications.
Historically KYC has been done manually, but with new advancements in computer vision and deep learning technologies, automatically identifying people in images is possible.
For example, investors can use video calls for investment verification, and retail clients can consult with their bankers before the actual meeting.
It helps businesses keep up with the latest trends that can help them stay ahead of the competition.
How does KYC work
Identity verification, or Know Your Customer (KYC), allows companies to identify who they are doing business with. It is to make sure that they are not accepting money from criminals or terrorists, but instead people known to them.
With the growth of online payments, it is becoming challenging to ensure that criminals or terrorists are not infiltrating financial networks.
Using computer vision and deep learning technology, organizations can now collect image-based data, which can help them verify identities better than ever before by analyzing physical attributes of clients such as their faces, height, and skin pigmentation. The collected images are then analyzed to compare with pictures in an image-based KYC database.
Computers can now do what humans previously had to do: sift through piles of documentation and look for subtle patterns that can identify a person.
Why do organizations use KYC
Organizations that require Know Your Customer (KYC) would be either those that want to work with their customers or those that want to prevent fraud. By using this, the organization will be able to learn more about the person.
For instance, administrators will ask them questions if they are applying for a job and are in another country but can’t provide a form of identification. They may ask a few different locations to verify their address or when they were born, but they can also verify their identity by asking for information such as the first day of school or their favorite food. KYC is used in more industries than you may think.
One job that requires KYC is when people are working in the financial industry. Since they hold onto other people’s money and charge interest, it is vital to verify their identity, so you don’t accidentally give money to someone who isn’t who they say they are. Banking organizations consider this because there are many cases where fraud has occurred. People have used fake documents to get small loans and then defaulted on the loan, leaving banks with fewer funds and having to pay out more due to someone else spending the money they borrowed.
Other jobs using KYC would be those of private detectives or police departments to learn about their suspects or victims before meeting them face-to-face, significantly if these individuals could potentially harm.
Hospitals also make sure the patients are who they say they are and that their insurance information matches up before providing treatment.
Benefits of using KYC
The benefits of using KYC are that it is easy, affordable, and efficient. It also provides a lot of security for the company doing it.
With KYC, companies can provide more personalized and individualized services to their clients. These include:
The use of computers to scan documents leads to a lot of information is gathered about that person. It provides a lot of time savings for the company because it only takes a few minutes instead of days or weeks.
Technology helps the organizations to expand globally without going through the slow process all over again. It is known as “the same face, same name, wherever you go.” By doing this kind of service, companies understand their customers better to give them offers that they would enjoy and want. KYC implementation allows governments worldwide to have a more transparent view of their citizens’ wealth and assets.
It can help in reducing money laundering, tax evasion, terrorism financing, and other financial crimes. Governments will know where the assets are located at all times and would have a better hold on the country’s finances.
Implementing a successful KYC program in your organization
Know your customer programs help organizations gauge the risk involved with their customers. If a customer’s history has been riddled with fraud, it may be better for them to refuse that customer’s business. To implement a successful KYC program in your organization, keep in mind the following tips:
-To find out about your customer, ask them their first and last name and email address. The email can also provide information about the person’s location or other contact details.
-It’s essential to start a dialogue as early as possible—don’t wait until after the sale or purchase before you speak with someone. Not only does this save time, but it also helps establish a relationship with your potential customer sooner.
-Create a positive and open relationship with your customers by remembering their birthdays and celebrating other important life events (e.g., getting married). Furthermore, send them congratulatory messages to maintain that personal touch at the start of each year or month.
-Finally, if you’re going the extra mile to get to know your customer better, they’ll appreciate it! There’s no point in having a KYC program if the customers feel like their information is being collected without their consent—make sure they know what you are doing before moving forward.
KYC (Know Your Customer) is a standard procedure for businesses looking to ensure that they are meeting the expectations of their customers.
KYC procedures can help organizations identify and mitigate fraud, prevent terrorist financing, maintain regulatory compliance, reduce risks associated with financial transactions while also managing customer relationships better.
This article shows you how KYC works and some benefits of using it in your organization. We hope these insights have been helpful!
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