Video Identification Verification process: Its Criteria and Advantages
In the digital age, video KYC (Know Your Customer) solutions have become essential for regulated industries, particularly in Germany, where the Federal Financial Supervisory Authority (BaFin) enforces stringent anti-money laundering (AML) and KYC regulations.
Video KYC is a mandatory process for customer onboarding, conducted by specially trained staff in real-time using end-to-end encrypted channels for video chat. It allows users to confirm their identities in a live video interview, providing explicit consent to the entire identification process.
To comply with BaFin's regulations, video KYC in Germany must adhere to several key points. Identity verification methods, for instance, must be secure and reliable, with video identification being one accepted method. This process must also fulfill AML requirements, verifying the customer’s identity in real-time against government-issued ID documents and checking for authenticity.
Technical and procedural safeguards are also crucial. The video KYC process must ensure the security of personal data, verify liveness (to prevent fraud from photos or videos), and provide an auditable record of the session. Furthermore, businesses must be properly licensed by BaFin for financial services and must implement video identification as part of their approved AML/KYC processes.
The system and operator assess the document and may ask for additional procedures if necessary. Document evaluation criteria include all features being visually identifiable, integrity and lack of manipulation, date of issue and expiry matching, period of validity checking, and orthography examination.
For businesses looking to implement video KYC, solutions like Sumsub offer a ready-made system that combines compliance expertise, a powerful technological platform, and trained operators. Sumsub's Video Identification solution offers businesses two ways to conduct video verification: integrating the platform with in-house operators or delegating it all to Sumsub's experts.
During the video identification process, users demonstrate their identity document and other necessary documents in front of the camera and upload them via the dashboard. Users should ensure they are prepared with identity documents, a web camera, microphone, quality internet connection, and a web browser.
Depending on the jurisdiction's AML rules, the entire video identification process may be required to be recorded and retained for several years. Video KYC is required for various financial sectors in Germany, including credit institutions, financial services institutions, payment institutions, e-money institutions, e-money agents, investment management companies, insurance providers, cryptocurrency service providers, and more.
In summary, video KYC in Germany is a vital tool for regulated industries, ensuring compliance with AML laws, reliability for identity verification including liveness detection, data protection, and alignment with KwG, GwG, and PSD2 standards overseen by BaFin. Businesses can contact the Sumsub team to set up a tailored video KYC flow in compliance with their regulations.
Technology plays a pivotal role in the video KYC process, as specialized platforms are used for secure video chat and identity verification, ensuring compliance with regulations. Several video KYC solutions, such as Sumsub, provide businesses with a ready-made system that combines technological advancements and industry expertise.
