Abu Dhabi Global Market (ADGM), the financial centre of the UAE’s capital, has successfully completed trials of a new app for improving Know-Your-Customer (KYC) processes, known as e-KYC.
The app is designed to simplify the know-your-customer obligations incumbent on financial institutions and other regulated bodies under anti-money laundering laws, and was developed with blockchain partners, banks and advisors, including KPMG.
Rather than submitting to individual ID checks and verification, the app enables customers to verify their identity on a one-off basis, recording the information immutably on a blockchain. From there, the information can be accessed securely by other institutions, with a full audit trail to ensure compliance with relevant laws.
According to those participating in the trial, the technology has allows for a “radically simplified” KYC process, which will deliver cost and efficiency savings during the onboarding process.
Richard Teng, CEO of the FSRA of ADGM, welcomed the project, and the “tangible benefits” it delivers for financial institutions in improving the KYC process. He said, “By harnessing the power of technologies such as blockchain, the e-KYC project has demonstrated tangible benefits that may be offered by an e-KYC utility for financial institutions in the UAE. In addition to enhancing KYC checks across the industry, the utility can achieve significant cost efficiencies and financial inclusion driven by unified KYC standards.
According to the executive, “The use of digital platforms to share information, transact and test solutions forms a core part of ADGM’s FinTech strategy. We look forward to delivering further meaningful results through the ADGM Digital Sandbox initiative, where we will facilitate FinTech-institutional partnerships and host consortium projects such as the e-KYC project.”
The platform allows individuals to have more control over their personal data, while simultaneously allowing institutional members access to the KYC material they require to discharge their obligations.
At present, KYC checks are conducted on an institution by institution basis, with the app expected to significantly streamline the process.
It comes at a time when several other regulators and banks are investigating blockchain technology for KYC in a bid to improve the efficiency of the process.
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The app […]