As LotusFlare moves forward and partners with CSPs to deliver valuable business outcomes, we come into contact with companies that offer innovative software solutions, who could be solution potential partners. Jumio is one such partner. They are, in our view, the leaders in the field of identity protection for digital commercial transactions, or Know Your Customer - KYC. (In the digital world, add the “e” and voila, eKYC.)
In getting to know Jumio and looking further into eKYC in the telecommunications industry, LotusFlare has come to two main conclusions. First, CSPs are not availing themselves of eKYC to a large extent at the moment (somewhat peculiar circumstance given the emphasis of so many on the digital customer experience). Second, eKYC is critical to further the process of digitization of CSP businesses. After the more you move from checking credentials in-shop or contact center settings, there must be some way for customers and CSPs to protect themselves in a digital commercial environment. eKYC is a must-have going forward.
Jumio is the expert and that’s why I asked Alexander Strigl, Partnership Manager for DACH and Central Europe, to help lay out the basics of eKYC and the prospects for its use in the telecom industry.
Stephen Krajewski: Alexander, thanks for answering questions around KYC in which Jumio is a clear leader. To start, what’s the goal of the KYC process?
Alexander Strigl: It’s mainly about verifying someone’s identity and establishing trust. The KYC process aims to uncover new customers’ true identities and determine if the source and/or use of their funds is legitimate. KYC also determines the amount of trust a financial company can assign a customer. Individuals and companies at high risk for money laundering will be monitored much more closely than other new clients.
Stephen: What are the basics of a KYC program?
Alexander: The basic idea is to be compliant with government regulations as you check the identity of potential or current customers. So, a government-compliant KYC process must contain certain elements. These include a customer identification program (CIP), which is a client investigation that may include searching public records, performing criminal background checks, examining sanction lists, and identifying politically exposed persons (PEPs). Then there is customer due diligence (CDD) which are steps to determine the identity of both the named owners and beneficial owners of an account and the sources of the account’s funds. And, ongoing monitoring so you continue monitoring accounts after the initial onboarding process to confirm that their financial transactions are not suspicious or high risk.
Stephen: What’s the difference between eKYC and plain EYC?
Alexander: Electronic Know Your Customer is simply using online processes to verify customer identity and customer transactions. More and more financial services companies are using eKYC to onboard and monitor their clients. Although the software for eKYC has advanced greatly, some companies worry about cybercriminals attacking the KYC process to hide their illegitimate practices.
Stephen: It looks like telecoms are still new to eKYC. What’s Jumio’s view about industry-wide adoption of eKYC, and what does it see when it comes to the telecoms industry?
Alexander: While KYC is a known process in financial services, it has been expanding across many other industries like gaming, shared economy, public sector, social media, mobility AND telecommunications. KYC allows telecom customers to verify identities online to identify their customers, and launch new services fast while mitigating the risk of fraudulent users.
Telecommunications is one of the fastest growing industries in the world, yet extremely competitive. Process automation allows telcos to scale their service activation, billing, support and more. Moreover, mobile operators have also seen an increasing number of SIM card fraud, illegal use of their services impacting their customer experience and brand. The adoption of online identity verification helps telecom customers scale their onboarding process and keep frausters away while reducing its cost.
Stephen: How are biometrics involved in KYC?
Alexander: By using biometrics to verify customer identity, you can make your KYC process simpler and more thorough. Implementing facial recognition, retinal scans, fingerprint IDs, voice recognition and other biometrics makes it much more difficult for clients to give you a false identity. These processes can be implemented into your automated onboarding software to minimize customer risk.
Stephen: Jumio and LotusFlare are partnering now. How does Jumio see the partnership?
Alexander: We feel privileged to be partnering with LotusFlare, who are focused on digitizing commercial processes for their telco customers and protecting them from fraud. By incorporating Jumio’s eKYC solutions, LotusFlare will make an even bigger impact in fighting fraud and providing a frictionless customer experience.
For more information on Jumio, please visit jumio.com.
Senior Director of Marketing