KYC or Know Your Customer is an integral part of making sure that both customers and financial institutions are protected. In the present day, there are many forms of technology that can make the process easier and more secure. Each comes with its own set of pros and cons.
Today, we are taking a look at some of the KYC methods and how Bitkub’s newly-added KYC process can increase your account’s security.
NDID (National Digital ID)
NDID is a digital database that is used for customer verification. It connects banks and other organizations so that they can share necessary information about customers. The system aims to set the standard for identity verification and improve the process of electronic transactions so people can securely gain access to the government and private companies’ services.
The main advantage of NDID is convenience. People can verify their identity directly from their mobile phones. However, there are still some limitations. In order to use NDID, you will have to verify your identity through other KYC methods with a bank first. Another disadvantage is the risk of impersonation. If a user sees a notification to link their data to a service but does not read it carefully to find out what the service actually is, there is a risk that a bad actor might link their data and abuse it.
NFC (Near Field Communication)
NFC is a verification process involving a microchip at the back of e-passports. Nowadays, passports contain a microchip that has biometric data of the owner like fingerprints and a headshot. This data can be read by the Near Field Communication (NFC) function of some mobile phones. Then, financial institutions can use this data to verify the identity of customers.
NFC is another form of KYC that provides convenience to users. However, its limitation is that it only works for those who have a valid passport, which, during the COVID-19 pandemic that causes travel restrictions, is harder to obtain. Moreover, the NFC function is not available in all models of mobile phones, making it inconvenient for those who don’t have one.
Dip Chip is a verification method that uses ID cards. Most ID cards for Thai people are now smart cards which contain a chip with information about the owner inside. The information includes full name, date of birth, gender, registered address, nationality, religion, fingerprints, ID photo and ID number. The dip chip method uses special card readers to pull out relevant information and compare it to another database for identity verification.This process can be done through banks and Counter Service at 7-Eleven.
Even though the dip chip method requires you to visit a location and is not as convenient as verification through mobile phones, it does provide more security. Next, we are taking a look at how it can make the KYC process more secure for us.
Dip Chip’s Security
Bitkub has changed its KYC method to dip chip to increase customers’ security since it offers many advantages in this regard, including:
It prevents the usage of fake ID cards since the microchip inside smart cards cannot easily be fabricated. Therefore, it is safer than just taking photos of ID cards.
The method also requires a photo of the person to be taken. This makes sure that the person doing the KYC is actually the owner of that ID card.
It reduces the risk of data leaks since photos of ID cards can be leaked in case of lost mobile phones or hacking.
The ID card reader only extracts information that is needed for verification and leaves everything else untouched. In the case of Bitkub’s KYC, we only use the necessary data to compare it with DOPA’s database.
The KYC process is necessary for the safety of our customers. We have considered all relevant factors to determine the safest and most convenient for everyone. Dip chip will help increase security and provide access to digital asset trading at a large scale.