Sustainable KYC through blockchain technology in Global Banks

Blockchain has spiked a lot of interest in this decade both from technology perspective and also from the various applications of this potential disruptive technology. This paper performs a systematic review of the research and adoption progress of the much talked about Blockchain technology in the context of Customer Onboarding and KYC for Global Banks. This systematic review embraces the prominence of the peer-to-peer technology and the substantial role it can play in the complete revamp of the KYC processes for Global Banks world-wide. This paper proposes a design for consortium based solution in recent rise of risk events in global markets around reconnaissance and security breaches where the customer data privacy was compromised. The increasing annual budgets for KYC and Annual Refresh for high risk customers has become a norm in the light of terrorist attacks in 9/11 and others. The regulators also have increased the compliance checks for customer onboarding processes and then a plethora of other compliance rules to perform the regular ongoing Trigger Event KYC (change of address, change of source of funds and many more). The need for a check on AML at a macro-economic level aligned to regulations like Patriot Act, Bank Secrecy Act but also at a micro level by performing credit and operational risk management. Strict KYC norms make sure the banks and accountable executives adhere to the fact that every customer has to prove the legitimacy of their existence by submitting Proof of Identity and Proof of Address along with documents supporting Source of Wealth. This paper details on how to determine the need for Blockchain for KYC and then study the benefits of implementing Blockchain for KYC if the technology is indeed needed for the banking organization.