The R3 blockchain consortium and ten of its consortium member banks have developed a proof-of-concept for a KYC registry for Know Your Customer (KYC) requirements which allows identities to be managed by their owners. The creation of a shared KYC service on R3’s Corda platform would allow participants to create and manage their own identities including relevant documentation.
BBVA, CIBC, ING, Intesa Sanpaolo, Natixis, Nordea, Northern Trust, Société Générale, UBS and US Bank worked together in R3’s Lab and Research Centre over a three-month period to develop a shared KYC service proof-of-concept using distributed ledger technology to place control of an identity with its owner. The project simulated establishing the identity of both a legal entity and an individual using KYC data and identity attestations by third-parties.
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The proof-of-concept demonstrated how distributed ledger technology can help banks fulfill basic KYC requirements of new customer onboarding while providing increased transparency, security and cost-efficiencies. In addition, it provided bank clients with a single interface for managing their global identity, which in turn simplifies and streamlines the onboarding process.
David Rutter, CEO of R3, comments: “The growing complexity and cost of KYC compliance requirements presents a major challenge for banks on-boarding new clients and is having a negative impact on those client relationships. Distributed ledger technology can provide a unified view of clients whilst also significantly reducing costs and time spent verifying identity.”