Video Based Customer Identification Process

20 February, 2024

To provide enhanced convenience to the customers, the Reserve Bank of India (RBI) introduced Video KYC. It simplifies the Know Your Customer (KYC) process, allowing customers to verify their documents from the comfort of their homes. The process utilises audio-visual interactions to complete the KYC process. Read on to explore more about the security of VKYC and its working.

What Is VKYC?

VKYC is a video-based customer identification process that combines facial recognition technology with customer due diligence. It allows authorised officials of Regulated Entities (REs) such as banks and other financial institutions to interact with the customers through live audio-video sessions. VKYC adheres to strict standards and procedures to make it equivalent to face-to-face KYC process. It fulfils multiple purposes that include:

1. Collecting necessary identification information.
2. Verifying the authenticity of the data provided by the customer.
3. Maintaining a comprehensive audit trail of audio-video sessions.
   
   

Robust Infrastructure Of VKYC To Ensure Security

RBI has placed advanced level of security measures to ensure security and implement the video-based customer identification process effectively. Here are some key standards that need to be followed:

1. Cybersecurity compliance: Banks and financial institutions must comply with the guidelines provided by RBI on minimum baseline cybersecurity and resilience framework. This includes safeguarding against various cyber threats to protect customer data.
2. End-to-end encryption: To ensure that sensitive information of the customers remains confidential and protected, the banks have been instructed to keep the data exchanged between the customer’s device and VKYC application encrypted according to the appropriate standards.
3. Geo-tagging and timestamping: VKYC must be recorded with live Global Positioning System (GPS) coordinates and date-time stamps. Geo-tagging and timestamps help to prove that the video-based customer identification process was executed in real-time to verify customer’s identity without any doubt.
4. Face liveness and spoof detection: VKYC applications employ advanced facial recognition that reads face expressions to detect signs of face spoofing or manipulation. The VKYC application utilises artificial intelligence to enhance the face recognition process.
5. Regular updates and threat assessment: To tackle forged identity attempts and other potential cyber threats, the VKYC infrastructure and application software is regularly updated. The banks using VKYC applications must subject their VKYC infrastructure to vulnerability assessments, penetration testing and regular security audits to rectify any critical error.
   
   

Working Procedure Of VKYC

The RBI has given guidelines to implement the video-based customer identification process to keep it secure and tamper-proof. Here are some key instructions:

1. Trained officials: Officials who are specially trained for VKYC are authorised to execute the process.

2. Real-time interaction: The sequence and types of questions asked during the video identification process must vary to confirm that the interactions are indeed happening in real-time.

3. Permanent Account Number (PAN) verification: A clear image of the customer’s PAN card must be captured, except when the customer provides an e-PAN. Then the PAN details provided by the customer should be verified from the issuing authority’s database.

4. Assisted VKYC: Banks are allowed to enlist the help of Banking Correspondents (BCs) to facilitate the video-based customer identification process at the customer’s end. However, the responsibility of the customer’s due diligence will rest with the bank.
   
   

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