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Alternative KYC process to replace Aadhaar eKYC

JonMaximus October 16, 2018

Over the past few months, there has been a lot of news related to the linkage of Aadhar card for verification purposes. Large companies have sent regular notifications to their customers urging them to link their Aadhaar cards. Especially in the case of telecom, the operators have been behind their subscribers by sending them reminders via SMS or calls in order to continue using their services.

However, all this is now put to rest after the recent verdict by the Supreme Court against the usage of Aadhaar card for verifying a person’s identity. The verdict also means that your Aadhaar cannot be used for instantaneous eKYC by a private entity. As a consequence of the verdict, the Unique Identification Authority of India (UIDAI) has requested the licensed companies to put forward a plan for transitioning from the use of Aadhaar ID in the coming 15 days.

All the major organizations and firms like Banking, Telecom, Broadband Providers, Public Distribution, Ticket Booking Services, Gas Agencies, HR Companies, DTH Services, Logistics Services, Verification Agencies, Digital Payments, Subsidy Schemes, Retailer On-boarding, Electricity, and Water Supply Providers require authentication and identity verification.

Let’s explore the different eKYC methods their benefits and limitations.

• Paper Based Method

The paper based method constitutes a lot of steps that need to be undertaken:

Firstly, the organization representative visits the customer’s actual address for verification.

The representative will take a manual form along with him to get the data filled.

He will ask the customer’s documents of proof, his identity proof, proof of address, and for a photocopy of all the documents.

Along with these, he will also ask for the latest photograph and copies of identity proof.

Once all these processes are done, he will enter the data into customer information management systems.

Pros

The paper based method allows the data to be collected there and then.

Cons

The organization representative has to face operational challenges like managing the physical documents.

Time consuming.

• Manual Digital Forms

In manual digital forms, there is no need for the organization representative to carry a manual form with him.

All the different tasks can be performed easily by the representative on his mobile phone or a tablet instead of a paper.

The representative fills in the data digitally by visiting the customer’s actual address.

He can also ask for copies of identity proof and click the customer’s photo and take the signature.

Pros

There is no need to carry a physical paper form as the form is stored digitally on a device.

Once the information is filled in the form it is synced in real-time automatically over the internet

The information can be easily edited in the future as and when required.

Cons

As the data is filled manually, there is a possibility of typing mistakes.

This method is still time consuming and it requires the quality assurance team to verify the data as per the photographic proofs clicked.

• QR Code Scanning

QR code or Quick Response Code is a barcode label that consists of machine readable information.

This information includes basic details of a customer like his name, address, photos, and date of birth.

The company representative will have to visit the customer in order to get the QR code scanned from the relevant ID proof. For e.g. Aadhaar Card.

There is no need to fill in the data manually. However, data that gets left out is filled manually by the representative.

Pros

This method can be used for verification of the user offline without requiring the 12-digit ID number.

Scanning the QR code which automatically fills in the data of a customer.

There is no possibility of committing an error or mistake as all the information is automatically taken from the code.

Cons

This method cannot be used everywhere.

It will only work with those ID cards that come included with a QR code.

• OCR Code Scanning

Similar to the QR code, an Optical Code Recognition or OCR code can also be used for scanning the data in the eKYC process. FeetPort is among the very few mobile application that offers the OCR code scanning feature which directly populates the digital verification format.

To get a customer’s data or information, the organization representative will go the customer’s physical address and scan the document.

All the scanned data gets stored automatically.

The data includes the name of the customer, his address, photos, and date of birth.

The data which doesn’t get scanned or left out can be filled in manually by the organization representative.

Pros

The data will get filled directly that will save a lot of time, unlike the manual process that requires filling in the data physically.

The cost incurred by this method is much less.

Cons

OCR code scanning is still a new implementation in the market and has not been adopted completely.

The success of this method completely depends on the quality of the document scanned.

Sometimes the OCR code becomes dull due to which the organization representative is not able to scan it.

Conclusion

All the different eKYC methods showcased above have their own pros and cons. We are living in the time of rapid evolution of technology and that brings various opportunities to find solutions to issues such as KYC for new customers. With solutions available from A to Z, the scene looks positive for use of technology versus the use of paper which is so environmentally harmful.

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