Traditional KYC system
There are currently hundreds of proprietary traditional KYC system used by institutions however, mostly these are developed and maintain internally. There is no such KYC system in market which can handle the KYC process centrally. These systems have limitations and to many restrictions for use. They bring unclear process which can be misinterpreted.
Furthermore, there is plenty of room for KYC fraud left by these networks and as a result, institutions are exposed to humongous losses.
Traditional KYC System and SWIFT KYC Registry
There is mammoth proprietary traditional KYC system that is developed and internally maintained which are put to use by the institutions. At the moment, the KYC assists in acquiring personal information and validating them. The SWIFT (Society for Worldwide Interbank Financial Telecommunications) propelled the SWIFT KYC Registry. The centralized KYC registry can be accessed only by the financial institutions.
The Decentralized Belrium- KYC based Blockchain is based on the fusion of public and private blockchain technology. The public blockchain enables global remittance and the private blockchain is targeted to aid KYC compliance. The Inter Planetary File System (IPFS) protocol is developed to enable a permanent and decentralized platform for storing and sharing files.
The Financial Institution (FI) is linked to a decentralized Belrium KYC repository along with the lines of current KYC registry system. The decentralized blockchain technology can be applied for Inter and Intra FI verification processes. It lessens the time and effort. The Intra-FI applications empower the financial institutions in updating their ledger and acquire revalidation from external agencies.
The distributed ledger warehouses the customer data and relevant documents. The blockchain is based on DPOS algorithm which facilitates smart contracts that are transparent and secure. The IPFS, open source project which is also decentralized, adopted by the DPOS algorithm enables storage in information.
The FI aids in the storage of relevant data and generates a unique KYC number. The FIs can get access to the central registry, and the required customer information can be downloaded. Through the unique KYC number, another financial institution can enforce due diligence. The blockchain facilitates the seamless and secure exchange of information across different entities.