Corda KYC Trial
What is it?
KYC, short for know your customer, is an intrinsic element of identity management in modern day banking to prevent against fraud, terrorist financing and money laundering.
Why do we do it?
The KYC regulatory requirements are particularly focused on correspondent banking, which fosters economic prosperity throughout the world by enabling business and remittance flows between countries. However, when coupled with inconsistent standards, long turnaround times and duplicative processes, the burden of regulation has created major inefficiencies in the existing correspondent banking model.
Recent technological innovation in blockchain-based systems promises improvement in KYC compliance without the need for extensive networks with central administrators. Data on a blockchain platform’s distributed ledger is verifiable and immutable, providing increased transparency to relevant participants. The shared nature of blockchain technology lends itself naturally to providing a single, unified registry of KYC information for banks.
Who is participating?
RBI participated in the Corda KYC trial within R3 consortium in which 39 financial services firms around the globe have completed over 300 transactions on a Corda KYC platform. The transactions in the trial were conducted in 19 countries across eight timezones. Banks were able to request access to customer KYC test data, whilst customers could approve requests and revoke access. Customers were also able to update their test data which was then automatically updated for all banks with permission to access it.