Using digital identity verification, or eKYC, in banking transactions can reveal criminal’s face, preventing them from committing fraud under other identities.

In 2020, hundreds of cheap Netflix seekers in Vietnam were scammed by online sellers. Initially, users just paid VND 30,000, a tenth of the lowest fee that Netflix charges, for each account. The sellers had shown their seemingly genuine ID to establish credibility. Users transferred the money to the bank accounts of the sellers, and later found out that the password they received was wrong, and the sellers were unreachable. “We were able to contact the person in the ID, but it turns out this was another victim who was also tricked. The seller used his information to create a bank account under his name,” said Hoang Anh, a victim of the scam.

Using hacked bank accounts to cheat others has appeared for a long time, yet has not been thoroughly handled. Recently, scammers impersonated Thuy Tien’s fan page to trick people into donating to an account named Le Thi Ngan. Eventually, it turned out Ngan was just a victim of the scam, meaning scammers committed crimes under Ngan’s identity.

“Scammers can buy bank accounts for a little money from unscrupulous people, and lure them to give out their cards, passwords and Internet banking accounts. Then, they use this account to commit fraud without being detected,” said Ngo Dien Hy, General Director of VNPT Information Technology Company.

Hy added that one of the remedy for this problem is to use eKYC (electronic Know Your Customer) in banking transactions.

eKYC is an effective tool helping businesses, especially banks, insurance companies, educational and medical institutions to identify customers, verify documents and spot fraud. eKYC can detect user’s face, identify old, blurry or scanned documents with high accuracy by using a OCR-powered camera. Furthermore, it allows businesses to detect face spoofing attacks, counterfeit documents, and incorrect information on documents.

“Previously, it is difficult to detect intentional falsification of documents. However, today, digital identity verification can minimize this type of crime, as scammers will not dare to put their image into the system “, said Hy.

eKYC detects and compares portraits in personal identification documents.

In addition, eKYC enables customers to perform transactions online instead of going to the banks, saving much time for banking processes. In 6 months amid Covid-19, a Vietnamese bank witnessed an increase of new accounts, equivalent to 60% of the previous period, thanks to eKYC.

However, the deployment of eKYC in banking and finance is not a new trend. New technologies need a suitable legal framework before they are applied in practice. The State Bank of Vietnam is drafting an amendment to Circular 23 which regulates the use of eKYC in account openings so that the solution could be legally approved soon. Currently, several banks in Vietnam have piloted digital identity verification on a large scale.

“We always want to know each other in both real and virtual world. And eKYC would be a passport for us to enter the virtual world,” said Nguyen Huy Dung, Director of the Department of Information, under the Ministry of Information and Communications.

According to Hy, General Director of VNPT Information Technology Company, eKYC uses AI to improve accuracy, so “more data gives better results”.

In Vietnam, eKYC is currently developed by VNPT, FPT and VVN.

Source VnExpress 

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