Banks and Digital Transformation: SEPBLAC authorizes the identification of clients by videoconferencing

As of March 1st, 2016, financial entities are able to identify clients who are not present in-person via videoconferencing, which exponentially broadens the possibilities of the financial sector regarding long-distance operations, and its digital transformation in general.

SEPBLAC authorization is emitted based on the ruling of Law 10/2010, of April 28th, for the prevention of money laundering and the financing of terrorism

This regulation imposes new processes for the verification of information, documents, and the identity of clients which, until the arrival of new technologies, made long distance operations difficult, especially international ones. Face-to-face contact was obligatory, and the procedures to confirm client identity and their ID documents were slow and complicated.

Therefore, simplifying the process of identifying clients who are not present in-person through videoconferencing allows financial entities to streamline all of their operations.

Security before and during the process is essential.

Of course, the authorization demands certain security procedures, such as previous analysis of specific risk and the implementation of technical requirements that will, “assure the authenticity, validity, and integrity of the ID documents used and their correspondence with the client being identified.”

One could say that face-to-face presence is being substituted by the correct authentication of clients and ID documents.

The benefit is that, although the entity maintains responsibility, they can externalize the performance of identification procedures.

What is considered valid identity authentication?

According to article 25 of the stated law, during the conference the client must “visibly show the front and back of the document to be used for their identification”.

The same law indicates that the process cannot be completed if there are any indications of falsehood or of the manipulation of the ID document, or any mismatch between the document bearer and the client, or cases when the conditions of communication impede or hinder the verification of the two prior points --the validity of the document or the connection between the document and the person it identifies--.

Although the technical procedure to be followed is not specified, it is evident that a simple examination of the ID document can not determine its validity, or whether or not the client is really who they say they are.

Because of this, automatic identity verification technologies will be fundamental in long distance identification through videoconferencing.

Systems that carry out this verification already exist: by automatically reading the document and using facial recognition of the user, the ID document can be authenticated and a connection can be established between the digital and physical identity of the person.

In addition, the digital registration of information allows entities to meet requirements in terms of storage and custody of data.

These systems are well implemented in other sectors, such as hospitality and travel, or in the prevention of financial fraud. Now, their implementation allows the financial sector to take another step towards digital transformation, not only complying with regulations, but also streamlining processes, increasing security, and providing a better experience to clients.

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