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Blockchain-based Customer KYC in Srilanka
we all know that KYC is the most important aspect to to prevent the Money laundering and fraud instances in any Financial transactions and asset transfers
But how much time each institution or a bank is doing in doing such KYC exercises each time we are about to open/deal with the banks?
The same data of us will be verified n number of times every time we need to open an account and it involved lot of time and also lacks accuracy manytimes leading to ML Issues and fraud cases.
Here comes a solution for KYC.
How well it would be if the customer KYC data once verified is put on to the blockchain? Once the same verified by (Say SBI Bank) the same need not be verified by other banks when the same customer opens another account in another bank.
To summarise it will be like a Common KYC data pool for all the banks at one place in the blockchain thus providing immutability and Trust on customer identity
Srilanka is working on this model to verify and preserve the customer KYC data on the blockchain
Happy Reading…
The Monetary Board of the Central Bank of Sri Lanka is close to starting development of a blockchain platform expected to speed the processing of bank users’ ID information.
The Monetary Board has now shortlisted three software development firms to be tasked with designing a proof-of-concept (PoC) know-your-customer (KYC) platform, local news source the Daily Mirror Onlinesaid Thursday.
The final decision and the start of development are expected “shortly,” said D. Kumaratunge, Central Bank director of payments and settlements, at a Tuesday event.
The KYC platform is planned to allow the banking sector and the government to share and update bank customer data in real time on a blockchain.
Kumaratunge said several banks have given their consent to join the project.
The open call was on a voluntary basis; 36 national and international candidates applied for the projectlast November. One of the three finalists is a foreign tech firm.
The development of the system is expected to take anywhere between six and nine months to complete.
The project is expected to allow banks to onboard new customers without delays for manual processing, as well as save costs associated with traditional paper-based methods of verifying documents.
Sri Lanka has been taking steps to improve its financial sector to meet international standards.
In October 2019, the nation was removed from the Financial Action Task Force’s anti-money laundering/counter the financing of terrorism (AML/CFT) “strategic deficiencies” blacklist, to which it had been added in 2017.
