The electronic Know Your Customer Project
KYC, or Know Your Customer, is the mandatory process, conducted by businesses and institutions, of identifying and verifying the identity of the client when initiating the business relationship, and periodically over time. KYC policies have been expanding for some time and they have become very important globally. With issues pertaining to corruption, terrorist financing, and money laundering becoming so prevalent, KYC policies have now evolved into an important tool to combat financial crimes internationally. In Jordan, the KYC procedure is mostly paper-based and requires the physical presence of the client along with their original Identification Document (ID), and it is completed with a wet signature. eKYC, on the other hand, refers to conducting the KYC procedure electronically and includes capturing information from IDs, the extraction of digital data from government-issued smart IDs, or the use of certified digital identities and facial recognition for online identity verification. eKYC is a remote, paperless process that minimizes compliance costs, traditional bureaucracy necessary in KYC processes and risks associated with identity verification.
In its first three-year strategy, JoPACC is committed to advancing financial services and offering digital channels that will enhance the uptake and active usage of services and make the user experience more seamless. Consequently, JoPACC is developing an eKYC project that envisions a unified financial identity service for individuals and businesses, which will facilitate financial institutions to digitally obtain KYC information, required by the Central Bank of Jordan, enabling all residents of Jordan to access financial services remotely and securely through purely digital channels. This project is considered a fundamental asset in the digital economy and financial inclusion ecosystem, and will be implemented in cooperation with the Ministry of Digital Economy and Entrepreneurship, and the Civil Status and Passport Department under the supervision of the Central Bank of Jordan.
The primary stakeholders of the service are:
- All financial institutions licensed by the Central Bank of Jordan (Banks, payment service providers, system operators, exchange companies, Credit Bureau, Investment Funds, MFIs), as well as other entities licensed by the Jordanian Government (Mobile Network Operators, Insurance Companies...)
- Government agencies acting as identity data providers
- Private Sector companies including Telecoms
- All citizens, residents, and refugees in Jordan
The project will enable consumers to establish a trusted proof of identity, through a combination of a set of KYC information required by the CBJ, and verify and validate individuals’ identity through the integration with the Government Service Bus and The Civil Status and Passport Department records.