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Webinar Recap: Building Customer-Centric KYC in FinTech

Linus and Microblink share how they help customers succeed with KYC through automation, micro interactions, and customer service

Passbase’s webinar series brings together professionals to discuss how digital identity is applied in their respective industries. We have summarized our panel on Customer-Centric KYC for FinTech with Matt Hamilton, Co-Founder and COO at Linus, and Ante Sladojevic, Senior Product Owner at Microblink, to share their experiences and how they think about serving customers better through product UX from both a technical and design perspective.

Linus is a cash deposit account powered by crypto yield, where end users can deposit cash from their primary bank account earn earn high yield interest. Microblink is an AI company that helps business businesses identify their customer through the automated, secure, and frictionless user flow.

The text interview has been edited for length and clarity.

Q: You co-founded Linus on the idea that everyone should have access to the wealth-building opportunities that emerging digital assets provide. Tell us a bit about how Linus takes a customer-centric approach to your company and product.

Matt: My co-founder and I were very early in the decentralized lending and borrowing space and founded Linus with this idea in mind that we wanted to make these yields accessible for the everyday retail consumer. They need these returns in a friendly, familiar user experience. So what does that mean? Easy authentication using email and password as opposed to a public private key pair which was a concept that a lot of crypto wallets were founded on at the time.

Another thing was that we wanted our customers to be able to deposit and withdraw directly to a primary bank account. The third thing we felt was lacking in the space and necessary within our product was support. When a user gets stuck, they need somebody to be able to contact immediately – not by submitting a support ticket and getting maybe an email back in 24 hours or seven days. So what resulted was a product that looks different from a typical crypto wallet and more like a neobank offering.

Q: Ante, could you tell us a bit about Microblink: how are you innovating to make ID document scans and data extraction seamless for the end user?

Ante: Microblink is an AI company that helps business businesses identify their customer through the automated, secure, and frictionless user flow. When you take your document and point your mobile phone at it, within less than a second, we extract all the information and read the document, without any hassle of pre-selecting the country or document type. We do everything on device in real time.

We have multiple machine learning models, which continuously check the document in front of the camera: what document is it? Can we extract and read it? Can we verify it is legitimate? It gives businesses the possibility to seamlessly, frictionlessly, automatically do one that extremely important single thing for the end user to get onboarded and complete the transaction. Recently, we also are moving to verifying documents.

Q: Ante, how do you think about prioritizing user experience as well? Where are the strategies for improving UX that can apply to companies more broadly?

Ante: UX is an essential part of this trio of security, accuracy, and UX. Users can handle a certain amount of friction, but if you build a flow that has too much friction, they will leave you immediately. It’s important that every touchpoint and every interaction helps the end user to pass the entire flow.

For the end user, a natural way to get onboarded is to provide the ID document, scan it and move on. It’s important here to ask a few questions. The first question is what information is important for your business? What do you need to gather from the end user? Is it just an email, phone number, or broader information from their ID documents? Second, how will you ask users to give you this information? What are you going to tell them when asking them for this information? In the end, how will the user give you this information? Answering these questions will give you focus on the user experience.

You don’t want the user to type all the information into some kind of form if you can pre-fill it from just scanning the ID document.

Q: As you were developing Linus’s KYC & AML program, what steps did you take to make it customer-centric? For example, what impact did you find that customer support had in making users feel comfortable?

Matt: For context, I mean, we do full KYC on our user’s name, address, date of birth, SSN through a selfie and ID scan. It was more of a banking partner requirement to collect everything, except for the selfie.

One of the things we wanted to do as a new product was not present our users with sign up and give us all of your information right away. First, they sign up and then they’re able to get a feel for the UI, and understand the product before overcoming that mental barrier of providing this company with sensitive personal information.

When you when you sign up, there’s a breadcrumb. “Getting Started” components on the dashboard tell you the steps you need to complete in order to get onboarded into Linus. The very first thing is a link to complete identity verification.

Our chat system detects when a customer is sitting on a page for longer than a specific amount of time and we prompt them with a message that says, “Hey, are you having trouble? How can we help? Respond below.” We find that a lot of customers do take advantage of this. It’s usually a couple solutions that we can we can prompt.

If their identity verification is rejected, we’ll typically try to provide them with suggestions via email and via the UI in the app to help them resubmit their verification and overcome any steps that might have been the reason they were rejected. If we see errors in Slack popping up with a particular user, we’ll go and take a look at where those errors are coming in.

Q: Microblink has experience providing identity technology for companies across FinTech, Banking, Crypto, and more. What have you learned about how identity document scanning can optimize user onboarding?

Ante: Every interaction touchpoint is a friction. When you go back 10 years ago, you needed to go a bank branch, stand in line, give your ID, then you need to fill out the form with a pencil, and then open, hopefully open, a bank account, right? User centricity moved that online, scanning a document and filling the form automatically.

Overall, effective document scanning does that one task in a second. First of all, volume cuts costs. There is no other person that needs to verify the information if everything is done automatically. There can be a backend office and sometimes you need that.

Document scanning can also come later when you ask for additional information for some kind of user benefit. This reduces upfront onboarding friction. Finally, it helps comply with the KYC regulations.

Quote from Matt Hamilton, COO and Co-founder of Linus: "We were looking for a developer-focused experience for our implementation. Good documentation, great support, implementation support. The Passbase team set up a shared Slack channel with us and basically held our hand throughout the process. And, and ever since we still have communication with your team.

Q: Matt, how did vendor selection play into how you thought about your KYC program? What was important across different stakeholders from development to compliance to customer experience?

Matt: When we were building this out, we only had five people, so it was a pretty easy decision making process. But generally, there were some things that we were looking for:

  • A very user experience that could be completed on on any device, whether it’s a mobile device, a web browser, or a tablet.
  • Having nudges.
  • A developer focused experience for our implementation, such as SDKs, that worked with our technology stack, notifications and web hooks for events and good documentation.
  • Good documentation, great support, implementation support. The Passbase team set up a shared Slack channel with us and basically held our hand throughout the process. And ever since we still have communication with your team, which is not something to be to be taken for granted.
  • Startup friendly pricing. When you go to some KYC vendors, one of the first questions they asked you is how many verifications are you going to be doing? And it’s like, well, we’re a startup. We could do one this month; we could do 10,000. We needed something that really had a kind of pay as you go model that allowed us to scale into scale into pricing, as we as we grew.

Q: Ante, as a product owner, what do you think are the highest impact problems in KYC to solve for businesses and end-users that can move the industry forward?

Ante: I feel that the two most important things are trust and friction. And not only trust for the business that the end user is real person and that everything about them is correct. But actually also that the end user trusts you and your brand and your business, and giving you this information will benefit them. So it’s a two-way street. It’s extremely important because they’re sharing some personal information with us, and they expect something in return.

The trust part is always around, also for reducing fraud. You want to be sure that people are who they say they are, that they use real identity documents and that person in front of the camera is a real person and not a fake one. So looking at the industry, I think industry is going in a good direction using the ID and biometrics. Especially since the pandemic, this was really, really accelerated. People started to trust in businesses more and businesses started to think, “Okay, let me let me ask you nicely to share your ID card and your face with me, and I’m going to give you this amazing service that I’m building for you”. So I think that the industry is going in a really good direction.

Q: Matt, online KYC is shifting from identity verification as a point-based service to a more holistic view managing and securing digital identities. How do you think about the future of KYC from both a business and user perspective? What considerations will be important when shifting mindsets from identity verification to digital identity?

Matt: Over the next five to ten years, I would personally like to see user authentication and identity verification begin to merge on a mass market level. You can see the concept of digital identity seeping into end user lives with OAuth services, like login with Google. That and your ID, your taxpayer ID, and your social security number in the US are attached to this so that you are able to share this securely with a service.

And from a business operations perspective, it would be great if I didn’t have to both build user authentication for sign in and build in the flow for identity verification. It would be amazing if a customer could just sign up for Linus and boom, all of their information that they have stored, maybe on their mobile device, is shared with us instantly. And we can verify that they are who they say they are.

I feel as more and more services begin to require that users verify their identities, customers are going to get kind of tired of uploading and verifying all their personal information. They’re going to begin demanding some more Integrated Authentication Service for FinTech and broader applications.

Q: Finally, Ante, what advice would you give leaders who want to successfully deliver a product that truly puts the customer first from a security and usability standpoint?

Ante: Be straight with your users. They’re willing to share their identity with you as long as you tell them what benefits they will have.

Q: And Matt, what advice and tips would you have for  leaders looking to ensure their KYC process is as frictionless as possible while securing digital identities for all?

Matt: As much as we want it to be, it’ll probably never be frictionless. Users will always find a way to have a problem. Make sure you have the ability identify when customers are encountering issues and you have the ability to be proactive and support them.

Reach out via support, have the right breadcrumbs to help your users along the funnel, and make sure you have information documented in the FAQs about troubleshooting and what you’re doing and why you need their information.

We’d like to extend a huge thank you to Ante and Matt for sharing their perspectives with us. To learn more about how you can make your KYC process more customer-centric, book a demo with a member of the Passbase team.

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Passbase is an identity verification solution that makes facial recognition, liveness detection, ID verification and KYC and AML compliance accessible through a suite of flexible developer tools. A zero-knowledge architecture ensures that companies using Passbase can securely verify users from over 190 countries without having to store their data. Built for developers, it can be integrated with just a few lines of code on iOS, Android, and Web.