{"id":38,"date":"2019-09-05T13:53:26","date_gmt":"2019-09-05T08:23:26","guid":{"rendered":"https:\/\/abhashstempblog.wordpress.com\/?p=38"},"modified":"2025-12-29T16:34:44","modified_gmt":"2025-12-29T11:04:44","slug":"the-race-to-know-your-customer-is-a-costly-exercise-but-theres-a-solution-kyc","status":"publish","type":"post","link":"https:\/\/blog.in.springverify.com\/the-race-to-know-your-customer-is-a-costly-exercise-but-theres-a-solution-kyc\/","title":{"rendered":"The race to KYC is expensive, but there\u2019s a solution"},"content":{"rendered":"\n

Around 3 Million KYC transactions<\/a> are done daily using Aadhaar. UIDAI has facilitated almost 7.5 Billion Aadhaar KYC transactions till date. It almost equals a transaction for every human on Earth<\/a> in numbers.<\/p>\n\n\n\n

Impressive, isn\u2019t it?<\/p>\n\n\n\n

There is a race by digital wallet companies around India to conduct KYC for every one of their customers. The deadlines have been changed multiple times, and as of now, stands at 29th February 2020 as stipulated by RBI<\/a>.<\/p>\n\n\n\n

Companies have failed dramatically in conducting KYC\u2019s. Part of the problem lies in the costs associated with physical verifications which can run as high as Rs 250 per customer. Considering the costs related, Paytm would have to shell out around $350 Million to verify their 100 Million user base<\/a>.<\/p>\n\n\n\n

It is serious amounts of money spent to confirm if the customers are legit. It is the same process all major wallet companies would have to go through. The process is necessary, but the amounts associated with it is not justified. It is the reason these companies are on the lookout for solutions which could reduce their costs for KYC\u2019s. Such a mandate was imposed by RBI to curb the money laundering happening through these platforms.<\/p>\n\n\n\n

The underlying cause has not changed if we compare the need to have Aadhaar for Indian citizens with the need to have KYC for e-wallet companies \u2014 Reduce Defaulters.<\/em><\/strong><\/p>\n\n\n\n

The difference between both the processes is not as massive as the numbers have us believe. With Aadhaar, the procedure requires only one physical verification for an individual. While with the e-wallets, the verification process is repeated every time for each wallet used by an individual.<\/p>\n\n\n\n

Repeating the same process multiple times is the problem.<\/strong><\/p>\n\n\n\n

The Indian government has spent close to $8 Billion to identify individuals through the Aadhaar project uniquely<\/a>. Banks and communication companies have used the Aadhaar linking protocols to successfully onboard customers. It is possible with e-wallet companies as well except that the mandate requires physical face-to-face verification of customers.<\/p>\n\n\n\n

It is where it costs as much for KYC.<\/p>\n\n\n

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