A new electronic platform is set to be launched in Pakistan, with banks across the country planning to introduce a blockchain-based Know Your Customer (KYC) system. This system will allow customers to exchange personal information, with the network being decentralized and self-regulated.
Pakistan Banks To Employ Blockchain KYC Verification
The Pakistan Banks’ Association (PBA) signed a contract to implement the blockchain-based KYC system, which will be developed by Avanza Group. This group consists of companies specializing in advanced banking applications, customer service management solutions, blockchain and artificial intelligence.
The signing ceremony was held at the industry organization’s office in Karachi and was attended by several officials, including the president and chairman, Muhammad Aurangzeb, and the CEO of Avanza Innovations, Waqas Mirza. The PBA has been responsible for overseeing the project on behalf of its members.
The implementation of this platform is part of the efforts of the State Bank of Pakistan (SBP) to strengthen the country’s anti-money laundering (AML) and counter-terrorist financing (CTF) control infrastructure, as explained in a press release.
“In addition to improving AML controls, the deployment of this platform will bring about efficiencies at participating banks and will result in an improvement in customer experience,” the PBA stated.
The e-KYC platform was created by Avanza and uses blockchain technology to allow banks to standardize and exchange personal data via a “decentralized and self-regulated network.” This should be done with the consent of customers, according to the association.
The KYC checks completed by other institutions will enable customers to assess their current and future customers, reducing the onboarding costs and improving the customer experience when opening an account. This should help “facilitate financial inclusion,” the PBA added.
Last year, SBP Governor Reza Baqir said that the country’s banks need to implement blockchain technology in their operations. He expressed his belief that the technology is “very important” for banks in terms of transparency, security, and customer protection.
Baqir He highlighted that he does not see many positive applications for crypto. Nonetheless, he also acknowledged that blockchain technology has the potential to address various issues.
Do Consider that Pakistani Banks may also find other uses for blockchain technology. Feel free to let us know your thoughts in the comment section below.
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