{"id":7269,"date":"2022-08-11T06:00:45","date_gmt":"2022-08-11T13:00:45","guid":{"rendered":"http:\/\/www.trulioo.com\/?p=7269"},"modified":"2023-07-31T23:48:27","modified_gmt":"2023-07-31T23:48:27","slug":"ekyc","status":"publish","type":"post","link":"https:\/\/www.trulioo.com\/blog\/kyc\/ekyc","title":{"rendered":"eKYC \u2013 Electronic Know Your Customer best practices"},"content":{"rendered":"\n

Most countries have well-established Know Your Customer (KYC<\/a>) rules that specify identification, due diligence and risk assessment procedures for verifying identities. But many KYC guidelines and regulations don\u2019t reflect the reality of digital transactions.<\/p>\n\n\n\n

While modifying laws to make them more applicable is possible, many countries have established electronic Know Your Customer (eKYC) regulations to match digital and mobile realities. In general, eKYC refers to fully digital processes that use identity verification solutions or digital ID systems. In India, for example, eKYC is a consumer term referring to identity verification through the Aadhaar system.<\/p>\n\n\n\n

Effective eKYC systems often have secure, authenticated, government-issued electronic identification (eID). A government eID guarantees widespread trust and ladders up to new services and capabilities, such as digital signatures, e-voting and accessing secure e-services.<\/p>\n\n\n\n

Leveraging digital ID systems<\/h2>\n\n\n\n

Estonia is at the forefront of eID developments<\/a>. The small, Baltic country has had digital ID capabilities on national ID cards since 2001. The eID is embeddable in a secure SIM card, giving mobile phones<\/a> full identification capabilities.<\/p>\n\n\n\n

Estonia<\/strong><\/p>\n\n\n\n

Estonians can use their eID for more than 600 government services, such as healthcare, filing and paying taxes, and voting. The eID also provides full legal status for any interaction in Estonia that requires identity confirmation, such as eCommerce, opening accounts at financial institutions, and signing contracts.<\/p>\n\n\n\n

The ID system also offers an advantage for Estonian businesses. More than 2,400 government e-services are available. What previously took days or weeks is now possible in minutes. For example, opening a business in Estonia takes approximately 18 minutes.<\/p>\n\n\n\n

Overall, eID has had a dramatic effect on Estonia. The country in 2014 took it a step further by introducing e-Residency<\/a>, which provides eID to citizens of other countries, allowing them access to various e-Services.<\/p>\n\n\n\n

eIDAS<\/strong><\/p>\n\n\n\n

In the European Union, the electronic Identification, Authentication and Trust Services (eIDAS<\/a>) identity framework is intended to enable one EU member state\u2019s eID to be used in all others. The goal is to create a modern identity framework that can perform electronic identification and trust services for digital transactions.<\/p>\n\n\n\n

In its current form, the framework requires member states create their own rules and notify others, which must accept the ID scheme when allocating public services. But not every EU country has implemented eIDAS<\/a> yet.<\/p>\n\n\n\n

A more recent initiative, the European Digital Identity Wallet<\/a>, is designed to provide an EU-wide eID that can be used for digital onboarding for cross-border services.<\/p>\n\n\n\n

Global eID systems<\/strong><\/p>\n\n\n\n

While Estonia joined the game early, there are now more than 60 countries with eID systems<\/a>. Others are creating digital identity frameworks and gathering feedback for eventual implementation:<\/p>\n\n\n\n