eKYC technology that transforms identity verification in the digital age

Currently, when making financial transactions or registering for various services—such as opening a bank account, investing, or purchasing insurance—you may have already experienced verifying your identity electronically at least once or twice. This is called eKYC (Electronic Know-Your-Customer), a technology designed to make identity verification processes easier and more convenient. In this article, we will explore what makes eKYC stand out, how it works, and which areas it is best suited for.

What is eKYC? A Digital Identity Verification System That Makes Life Easier

eKYC (Electronic Know-Your-Customer) is a modern method of recognizing and verifying customers’ identities through digital systems. Instead of visiting an office in person as in traditional KYC processes, eKYC allows users to register and verify their identity from home using electronic devices such as smartphones or computers.

The development of eKYC stems from the need to improve traditional identity verification methods, which can be time-consuming, complicated, and inconvenient. By applying biometric technology and intelligent data processing, eKYC offers an efficient solution. Users no longer need to fill out extensive paperwork, saving travel time, and reducing the risk of document forgery and manual recording errors.

Types of eKYC and Technologies Used

Currently, there are different methods of processing eKYC to suit the needs and environments of various institutions. These mainly include three types:

Type 1: Biometric Authentication

This method uses physical characteristics of individuals for identification, such as fingerprint scans, iris scans, facial recognition, or voice. This technology is popular and widely used in eKYC systems because biometric data is unique to each person and difficult to forge. You may have seen this in smartphone login or mobile banking transactions.

Type 2: OCR (Optical Character Recognition)

OCR technology scans and reads data from physical documents like ID cards, passports, or bank statements, converting them into digital data. This reduces manual data entry time and errors. OCR-based eKYC systems are commonly used for verifying identity documents and addresses.

Type 3: NDID (National Digital ID)

NDID is a national digital identity verification system developed by government and financial institutions. In Thailand, banks and financial institutions often use the NDID standard to scan facial images and data from ID cards. This system ensures reliable and consistent identity verification.

Standards and Data Used in eKYC Systems

To ensure secure and effective eKYC verification, systems require diverse data and multiple methods of identity confirmation. For individuals, the data typically include:

• National ID number
• Full name
• Date of birth
• Current address
• Mobile phone number
• Email address
• Facial scan

For legal entities or businesses, the data may include company name, registration number, and registered office address.

In addition to basic information, eKYC systems also need authentication factors, which include:

• Something You Know — such as passwords or PIN codes
• Something You Have — such as ID cards, smart cards, or mobile devices
• Something You Are — such as fingerprints, facial features, or iris patterns

Combining these methods enhances security and reduces the risk of fraud or unauthorized access.

Advantages of eKYC Making It a Popular Technology

Convenience and Time Savings

Users can register and verify their identity via eKYC anytime and anywhere without visiting branches or service centers, saving time and travel costs. The entire process can often be completed within minutes.

Resource Saving and Paper Reduction

No need to fill out numerous forms or submit multiple copies of documents. eKYC reduces physical resource use and paper consumption, benefiting the environment.

High Security and Reliability

Data stored in eKYC systems are protected with multiple security measures, such as encryption and multi-factor authentication. This ensures high data security, reduces the risk of document forgery, and prevents personal data leaks.

Wide Application Across Sectors

eKYC is used not only in financial institutions and banks but also in government agencies, businesses, insurance companies, and other organizations requiring secure and efficient identity verification.

Drawbacks of eKYC That Need Improvement

Challenges for Elderly and Non-Tech Users

Not everyone can easily access or use eKYC, especially the elderly or those unfamiliar with digital technology, which may lead to service disparities.

Risks of Misuse of Personal Data

Despite high security, there is still a risk of personal data being misused or stolen through cyberattacks.

Privacy Concerns

Some individuals worry about biometric data collection, such as fingerprints and facial images, fearing how this data will be stored and used in the future.

How eKYC Differs from KYC

Verification Process

Traditional KYC: Requires in-person verification using physical documents like ID cards, passports, or bank statements, usually conducted by trained staff.

eKYC: Relies on digital technologies such as biometrics, digital signatures, and online systems for remote verification, often automated via computer systems.

Documents and Storage

Traditional KYC: Customers submit copies of identification documents, which are stored physically in secure locations.

eKYC: Since verification is electronic, physical documents are unnecessary. All data are stored digitally with high security.

Speed and Efficiency

Traditional KYC: Processing can take days or weeks, requiring customer patience.

eKYC: Can be processed quickly, often within minutes, allowing immediate service access.

Accuracy of Verification

Traditional KYC: Prone to errors due to human judgment and manual data entry.

eKYC: Highly accurate thanks to AI and machine learning technologies, reducing human error.

Security and Fraud Prevention

Traditional KYC: Physical documents can be forged or altered.

eKYC: Enhanced with digital encryption, multi-step verification, and biometric technology, significantly reducing fraud risks.

Customer Experience

Traditional KYC: Customers must visit branches or offices, which can be inconvenient, especially for those far away.

eKYC: Provides a smooth, convenient, and fast experience, with remote verification using devices customers already have.

Summary

eKYC is a vital and necessary technology in the digital age, demonstrating how business operations and customer services can be improved. Currently, eKYC verification is widely adopted across various sectors, including banking, government, business, and financial services—such as account opening, card issuance, investing, and insurance.

The data and methods used in eKYC help protect user information from theft and ensure confidentiality. At the same time, users enjoy convenience and speed in accessing services. This combination makes eKYC an essential technology for advancing toward a digital society in the future.