The importance of KYC
Know Your Customer (KYC) is a critical process carried out by companies to verify customer data, including their identity. KYC helps businesses to ensure that the person is whom they claim to be, enabling them to tailor their product and service offerings to meet customers’ specific needs. KYC also strengthens security against possible fraudulent activity or other types of attacks or threats. Manual KYC processes can be time-consuming and prone to errors. But businesses can improve efficiency and accuracy by adopting digital onboarding, which leverages biometric technology to streamline the KYC process. But what happens to the customer data once it is collected?
Data storage problems
Data storage has become a crucial issue due to the rise of digital transformation, privacy scandals, and large-scale security breaches. There is an urgent need to adopt a new identity management format that offers both security and independence. One promising solution is blockchain technology, which can make self-sovereign identity a reality. In the context of SSI, blockchain technology solves several issues that have plagued the digital identity world, allowing for the creation of a decentralised economic and social model.
The SSI model
Self-Sovereign Identity (SSI) is a model that provides individuals with complete ownership and control over their digital identities without the need for intermediaries. Unlike centralised identity management systems, individuals are in charge of their identities and decide who can access their data. Additionally, they can revoke access to their data at any time. By adopting an SSI model, businesses and organisations can offer their customers a more secure, transparent, and trustworthy identity verification process. SSI also eliminates the need for businesses to store and maintain sensitive customer data, which reduces the risk of data breaches and ensures compliance with data protection regulations.
Advantages of KYC with SSI
By combining SSI with KYC, companies can ensure that the data they collect is accurate, reliable, and verified. This creates a more trustworthy relationship between companies and their customers and can even help reduce fraud and other security risks. Additionally, SSI allows for more efficient and streamlined KYC processes, reducing costs, and making it easier for customers to onboard.
Overall, KYC with SSI offers numerous benefits. While customers enjoy increased security, privacy, and control, companies benefit from improved accuracy and efficiency. As digital transformation continues to accelerate, the need for a secure and reliable digital identity solution becomes increasingly important. SSI offers a promising solution to this ongoing challenge.