Abu Dhabi Global Market (ADGM) has published a summary of the scope and benefits around electronic KYC, after a successful first phase of its e-KYC project.
The summary has been released in collaboration with project advisor KPMG.
This e-KYC project was launched in March 2018 and is a consortium of UAE financial institutions which is led by The Financial Services Regulatory Authority (FSRA) of ADGM. Other members of the cohort are Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Al Ansari Exchange, Al Fardan Exchange, First Abu Dhabi Bank, and UAE Exchange.
Its main goal is to build a proof-of-concept to test operational and technological models of e-KYC. Together, the group has established a governance framework and business model which the e-KYC utility can operate on an inclusive and sustainable basis, it claims.
While creating the PoC, the consortium has set out to shape applicable processes and regulations relating to KYC individual retail clients. Its aim is to produce a common set of KYC standards.
Some of the benefits of the project found by the conglomerate include individual clients can decide how their personal data is shared in the utility and the ownership structure of the KYC utility means customer information is secure and operates in a non-profit manner.
Consortium members are also able to share and validate simulated KYC documentations and data updates about clients on the prototype.
Alongside this, the platform operates via incentive fees for data contributors, and success fees are shared with the KYC utility operator.
FSRA CEO Richard Teng said, “By harnessing the power of technologies such as blockchain, the e-KYC project has demonstrated tangible benefits that may be offered by an e-KYC utility for financial institutions in the UAE. In addition to enhancing KYC checks across the industry, the utility can achieve significant cost efficiencies and financial inclusion driven by unified KYC standards.”
Now the first phase has been completed, the FSRA is hoping to launch the next stage which will facilitate small and medium enterprises’ access to banking services.
A full summary of the project’s scope and findings can be found on the ADGM website. The group is welcome to any feedback or participation from the market with the project.
Copyright © 2018 RegTech Analyst