KYC stands for Know your customer which means identifying customers of a business. In this process, every user has to enter credentials, for example, a password or any document for accessing the service of the company. When a person goes to the bank for account opening it is verified by the bank and investors that are verified before participation. Customer ID verification before giving service is implemented by the fintech companies. This verification ensures that organizations and business are working in a legitimate way. In simple words, we can say understanding the customers before allowing them to access your services is a very good risk-averse scheme.
Impact of AI on KYC after AML
Money laundering has become cancer for economy of countries because it can be used to ruin the economic condition of any country. Most of the economies ruined by the money laundering cancer so countries have started taking steps to evacuate it. Eradication of this cancer is very important so modern Lawmaker has made tough Anti Money Laundry strategies to overcome it. An increase in Money laundering scandals is also the reason behind implementation of KYC modern techniques in businesses. Big banks and companies were fined because of money laundering or facilitating the launderers.
Anti-money laundering systems developed to avoid financial crime of money laundering. Despite these systems, it is challenging to make them effective due to the rapid change of current technology. Because every business in current age is going on worldwide through the website and its transactions between countries are normal. So need management of money laundering is becoming difficult for entrepreneurs.
Modern laws such as GPDR, PSD2, and 5AMLD are strictly implementing to overcome financial crimes. Many businesses face penalties and fines due to Anti-money laundering systems. It increases the problem for entrepreneurs to stay strict to the AML laws because of international regulations and conditions.
AI and Automation of KYC
AI stands for Artificial intelligence which makes AML practical and cost-effective. It reduces the need for staff and consumption of time on AML authentication. It can screen and manage huge quantity of user-profiles and their activities. It can change the environment and inputs which saves the business from any type of risk. It automates repetitive tasks at any scale and also rapidly.
According to a well-known KYC program developer following are the functions that are done with the help of KYC.
1-Identity verification
2-screening of users
3-Risk calculation and management
4-Dynamic web integration for users that will onboard
5-Use of software
Every business can not come to the AI, they have to ask a question that is it complains about Artifical intelligence KYC. Before checking compliance of your the business you should have to adopt AI according to your power to implement KYC on modern grounds.
AI benefits
There is a bundle of benefits for adopting AI. AI not only increases the cost-effectiveness of business but also reduces hurdles from the paths of customers. You can access business without the difference of demographics and without a wastage of time on the availability of customer service representatives. It automates all procedures of business in such a way that there did not leave any need for staff.
KYC consists of different methods but its automation is compulsory in every method. You can implement successful AI in your business with the help latest tools. Most of the people did not differentiate between KYC and AML whereas both are very different. Both work for each other it is true but it doesn’t mean both are the same. These automated systems have secured the entrepreneur from any type of penalties, expense and time wastage. Many businesses can not implement it because of their scale. Some companies avoid it because of their personal matters.
But anybody which is sincere with the business will definitely implement it for the betterment and success of its business in the modern age.
