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The Growth And Expansion Of KYC And KYP Within Digital Identity
Digital Payment

The Growth And Expansion Of KYC And KYP Within Digital Identity

By Rajarshi May 20, 2022 - 182 views

The expansion of KYC and KYP is a major talking point within the perspective of digital identity today. Several global nations are embracing digital KYC models or e-KYC portals. They are using the same for authentication and verification of users in a secure format.

Technologies such as DigiLocker, for instance, are changing mainstream engagement with KYC in most scenarios, filling up the gap in implementing complete digital identity and reliable verification/authentication of all citizens. It is also enabling remote authentication for transactions, services and so on.

Expansion Of KYC- Mapping The Current Scenario

The KYC full form is Know Your Customer while the KYP full form is Know Your Player. Reports estimate how several countries are taking the digital KYC route towards promoting higher inclusion and growth. A digital identity tackles the problem of people being excluded from development possibilities, new opportunities and services.

Of course, there is still some apprehension about the risks of data misuse or fraud. Yet, experts believe that multi-factor authentication, intelligent designs and better background verification can lower these risks greatly for the long haul. One aspect seems non-negotiable- Countries are realizing how digital KYC is a harbinger of equality and socio-economic progress.

Expansion Of KYC- Analyzing The Core Variables

Here are some aspects worth noting in this regard:

  • The complexities inherent in KYC have led to multiple issues with verification.
  • Experts have still voiced concerns regarding data leaks and the fact that almost everybody has been exposed in one way or another.
  • Another issue worth examining is the fact that people may have multiple accounts, email addresses and phone numbers along with addresses which are legitimate. Which is the one to use for verification while engaging digitally and what are the correlations among various aspects of identity? This is where fintech players are working to eliminate complexities with a view towards ensuring more accurate identity assessments.
  • Some experts have sought to demarcate digital identity from identity.  While it may not seem so on paper, there are major differences. The conventional version of identity is backed by physical identity cards which include written signatures and public registries.
  • Digital identity represents a complex environment which is continually being evaluated. With expansion of KYC and continual evolution, it is now transforming into KYP, i.e. Know Your Player.

KYC ensures higher importance for procedures as compared to individuals while KYP ensures more importance for people instead. Such procedural aspects have been witnessed in the online gaming space which is a harbinger for future developments to come.

The expansion of KYC into a medium of digital identity and verification will ultimately encompass multiple categories of transactions. At the same time, there is a seamless flow of KYC into KYP and this will emphasize individuals as mentioned.

Ultimately, there has to be a process for sorting out complexities regarding multiple identities and seamless merging of the same for digital verification. The growth of these trends will continue and ultimately the issues may be ironed out as per industry experts.

Key Takeaways:

  • KYC is steadily expanding into digital avenues.
  • It is flowing seamlessly into the concept of KYP.
  • Bottlenecks still remain as to the alignment of multiple identities and security aspects.