Know Your Clients: The Way to Competitive Advantage

Roobykon Software
  • Date Published
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We tell about the existing approaches in KYC as a way of a solution to the problem of safety and trust to e-marketplace.

KYC (Know Your Customer) is a complex of processes to check and verify customer data, a technique that helps to protect eCommerce resources from money transfer scams (e.g., restrict the use of unverified, potentially stolen credit cards). In general, this concept covers a wide array of business niches and industries, like banking and insurance business. The following article discusses this type of protection for digital marketing solutions and reviews briefly the main Know Your Customer requirements.

Know Your Customer: Requirements for Business

How do you think – do you know your customer well enough to use the knowledge for your business advantage? Well, you can get almost completely confident that there are no scammers among your buyers’ audience and lower the risk of eventually experiencing significant losses in terms of both finances and reputation. An expert Know Your Customer analyst will help you with that – in particular, you will acquire dedicated software to check user identification data.

The standard working scheme of any piece of the Know Your Customer software implies thorough identification and verification of a customer and some of their private data (including their attached payment card info). Advanced KYC systems also track suspicious transactions that involve a certain customer’s card. The ultimate importance of Know Your Customer capabilities is proven by the factual reduction of many potential risks by, among other things, filtering a number of allowed transactions for certain online store users.

As a result, your platform can automatically block accounts of suspicious customers and annul any purchases they have made – an ultimate way to protect your resource from scammy financial operations, including the use of stolen credit cards, etc. Moreover, you get the sole authority to inspect any shady operations yourself and cancel those until the inspection is done.

What Does Verification of Online Store Customers Look Like?

A working Know Your Customer strategy usually includes several procedures that can involve the same customer once or a bunch of times. In such a manner, the Know Your Customer checklist can be subdivided into three necessary stages:

  1. Identification – Extraction of the Know Your Customer information and allocation of a certain identifier for a particular customer.
  2. Verification – This is the Know Your Customer rule that implies the check of customer-provided data and full verification of the customer’s identity.
  3. Authentication – The approval of a customer’s identity during the repeated use of your platform.

KYC Technologies

Below, we are taking a look at the three most popular technological concepts well tried-and-tested in terms of efficiency for the development and integration of a Know Your Customer app.

Artificial Intelligence and Machine Learning

Machine learning (ML) and artificial intelligence (AI) are two advanced tech solutions that bring the performance innovation your KYC solution may need to solve the issues with the biometrics data faking. Particularly, the AI+ML-powered know your customer software won’t let scammers replace any real customer data by thoroughly tracking all the actions and ‘remembering’ them (storing) in order to analyze them further on.

Your KYC or Know Your Customer apps based on the AI/ML also allow to accelerate processes of big data analysis, which, previously, could take days or even weeks of both your and your customers’ time to finish up. Fortunately, now you can conduct these procedures in a matter of several hours (or even minutes), significantly boosting the quality of your service without affecting the retail routine as a whole.

The Use of Permanent Identifiers

Permanent identifiers are the biometric identification elements upon which the consistent KYC process stages are based – i.e., identification, verification, and authentication of users on your retail resource. Only recently, biometric methods of identification were a real innovation on the market, with respectively expensive implementation costs. Fortunately, it all went much cheaper in price over time, becoming an available option for medium-scale businesses.

The KYC strategy that involves biometric authentication includes the process of checking and proving the authenticity of a user-defined name (identifier) according to its biometric image (face, fingerprints, eye scan, etc.).

Biometric access systems nowadays are very convenient for common users. As opposed to passwords and data storages, which can be lost, stolen or copied, KYC systems that are able to recognize the corresponding biometric data fully resolve the problem of safety and integrity of account access keys.

Sharing a biometric identifier with third parties is, basically, considered impossible (even despite the fact that, in theory, an ill-minded person might forcefully steel the keys and produce their copies – in-depth biometrics authentication methods available right now won’t let these copies pass anyway).

Cloud-Based API Technology

As you may know, cloud computing is an efficient step towards increasing the performance of all services provided. Instead of buying expensive server hardware intended for the integration of KYC on a marketplace, you can build a cloud-based API. This Know Your Customer technology will let you distribute server powers only as and when necessary. Such a Know Your Customer open source system will free you of excessive expenses and allow to integrate a new security solution with an existing digital commerce product.

KYS Solutions by Roobykon Software

Roobykon Software is an experienced Know Your Customer outsourcing provider. We have been implementing KYC systems for several years now – both for the existing websites and for new resources on the stage of initial development. In particular, we specialize in implementing Know Your Customer solutions in marketplaces. If you wish to reinforce your E-Commerce online marketplace with a thorough, advanced means of security, let us get you the best possible KYC system to fit your particular needs and requirements.