Completing KYC with a bank is a poor customer experience including long delays, a lot of document gathering and a lack of customer transparency over usage of their private data

Identity in the developed financial services world is defined by government-issued identity (drivers’ license, passport, social security card, etc.) and the controlled acceptance of those individuals / entities (by CRM, KYC utilities, etc.) at an organisational level. However, major challenges in the collection and validation of that data against anti-money laundering requirements at scale has increased an individual’s barrier to entry into the financial system. This makes it unprofitable and a higher regulatory risk for banks to reach the undeveloped economies of the world that may not have even the most basic forms of identity.

In addition, regardless of where you live and whether you are an individual or a corporate entity, establishing identity with a bank is a poor customer experience including long delays, a lot of document gathering and a lack of customer transparency over usage of their private data.

The financial services sector has been trying to rethink the concept of identity for many years. Blockchain is a new computing architecture which has the potential to bring together fragmented data sets from the authoritative source providers into a single digital view of validated, immutable and cryptographically secured data. Further, it has the potential to deliver ‘self-sovereign identity’ – where the relevant individual or corporate controls the distribution of their own identity. What would this mean for the industry?