Sep 29, 2022
KYC Startups 2022: KYC Processes in Startups
The KYC (Know Your Customer) process is performed when a company or entity must know and verify the identity of the person with whom it interacts. For a company we will speak of a user or customer and for a public administration, for example, we will speak of a citizen.
KYC is a mechanism to protect both companies and users and should not only be carried out in large companies in the financial sector such as banks or insurance companies, but also in startups.
Importance of KYC in startups
Although only regulated companies in the financial sector are required to have a KYC process in place to prevent fraud or identity theft from other users through identity verification, it is also in the interest of startups to implement this process.
KYC in startups is performed during the onboarding process to verify the identity of users and that a person is who they say they are. In this way, there is a double protection for both the company and the users, by preventing identity theft.
Some startups, apart from those belonging to the financial sector or Fintech, that are particularly interested in carrying out a KYC process may be from these sectors:
- Mobility (car rental, carsharing).
- Travel (accommodation rental, travel).
- Collaborative economy (buying and selling second-hand goods, crowdfunding).
- Education (both online and face-to-face).
Find out in detail about the European regulations affecting onboarding procedures.
How a startup can grow thanks to KYC
The KYC process in startups has many benefits to ensure consolidated growth and to differentiate from the competitors, without having to be the onboarding or identity verification the main reason why it is implemented.
At Electronic IDentification we highlight 4 reasons why a startup should consider implementing a KYC process:
- Cost savings: automating certain processes such as user identity verification through an automatic flow allows for greater efficiency, scalability and cost savings.
- Digitalisation and UX: startups stand out for offering 100% digital services and being Customer Centric. A KYC process in startups accompanies this vision of always having the customer at the centre if it is easy, fast and fluid, which improves the UX and, consequently, conversion.
- Fraud prevention: fraud is also a factor that every startup must take into account to avoid losses. A proper KYC process in startups is a tool that, thanks to AI and verification algorithms, can detect forgery or identity theft.
- Security: both for the company and the end user.
eID, KYC solutions for startups
At Electronic IDentification we are experts in designing and developing automated and end-to-end KYC solutions for startups to make their processes more secure and cost-effective.
Our VideoID identity verification software allows you to verify a user’s identity, as well as perform an identity document check in minutes. In fact, we can verify more than 300 documents (ID card, passport, driving licence…) from more than 150 countries around the world.
The OCR (Optical Data Extraction) technology allows us to extract all the data from a document, as well as to verify its authenticity.
In addition, we offer our SmileID software to authenticate users through facial biometrics.
Request a free demo now and try the most advanced online identity verification process in the European market.