Related Terms
DEFINITION
eKYC
Electronic Know Your Customer, or eKYC for short, refers to the digital process of identifying and verifying customers as well as performing background checks in order to assess the potential risk an individual or a legal entity may pose. Unlike more traditional KYC solutions that relied on physical documentation and manual checks, eKYC fully utilizes modern technology to streamline the process.
Therefore, instead of having to bring your ID, passport and/or pay slips to the bank, you can do the process digitally via biometric options, such as video KYC or voice recognition, OCR, by just taking pictures of the needed documentation, single-use passwords, 2FA and more. For this reason, eKYC is heavily used in the digital banking space, as everything can be done digitally.
Synonyms
Electronic Know Your Customer
Acronyms
eKYC
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Synonyms
Electronic Know Your Customer, Electronic KYC
Acronyms
eKYC
Examples
A person wants to open a new bank account. They decide to go for a modern neobank that they’ve heard great things about. To send in the application, the customer just fills out an online form. To verify their identity, the customer takes a short video in accordance with the bank’s instructions and also provides images of their government-issued documentation. The process is largely automated and thanks to the eKYC system, they complete all the necessary steps quickly and without ever having to leave their house.
FAQ
What is eKYC verification?
Electronic KYC or eKYC verification is the process of verifying your identity via digital tools, for example, by taking a picture of relevant documents or filming a video of your face.
What’s the difference between eKYC and vKYC?
While eKYC can overlap with vKYC (video KYC), the former is usually used for processes that a customer can do completely on their own and digitally. For example, taking pictures of relevant documents or filming themselves. Video KYC on the other hand is typically done in real time with a relationships manager.
Does eKYC come with restrictions?
While this will differ depending on the jurisdiction, financial institution, and the account type in question, eKYC can come with some restrictions - such as lower transaction caps. Furthermore, in some cases, you might be required to go through a traditional KYC process at some point in the future.
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