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Abu Dhabi Global Market (ADGM), the financial center of the capital of the United Arab Emirates, has successfully completed the trials of a new app for the improvement of Know-Your-Customer (KYC) processes, known as e-KYC.
The app is designed to simplify the know-your-client obligations of financial institutions and other bodies regulated by anti-money laundering laws and has been developed with blockchain partners, banks and consultants, including KPMG.
Rather than undergo individual ID checks and audits, the app allows customers to verify their identity on a one-off basis, recording information immutably on a blockchain. From there, information can be securely consulted by other institutions, with a complete audit trail to ensure compliance with the relevant laws.
According to those taking part in the study, the technology has allowed a "radically simplified" KYC process, which will allow savings in terms of costs and efficiency during the onboarding process.
Richard Teng, CEO of ADGM's FSRA, welcomed the project and the "tangible benefits" it offers to financial institutions in improving the KYC process. He said: "By leveraging the power of technologies such as blockchain, the e-KYC project demonstrated tangible benefits that can be offered by an e-KYC utility for financial institutions in the UAE, as well as improving KYC controls throughout the sector, the utility can achieve significant savings in terms of costs and financial inclusion driven by unified KYC standards.
According to the executive, "The use of digital platforms to share information, make transactions and test solutions is a key part of ADGM's FinTech strategy and we are looking forward to delivering further significant results through The Digital Sandbox initiative of ADGM, in which we will facilitate FinTech's institutional partnerships and host consortium projects such as the e-KYC project. "
The platform allows people to have more control over their personal data, while allowing institutional members to access the KYC material they need to fulfill their obligations.
At present, KYC checks are conducted on an institutional basis by institution, with the app providing a significant streamlining of the process.
It comes at a time when several other regulators and banks are studying blockchain technology for KYC in an attempt to improve process efficiency.
