e-KYC Market: Description

Electronic Know Your Customer, also known as e-KYC is the electronic process that is used by various industries and organization, such as, offices, banks, telecom companies, and others. Here, in this process, the customer’s identity and address are verified remotely or electronically which provides the customers better experience when it is compared to physical KYC. e-KYC is also the way of authentication which is used by the organization, such as banks, offices, and other organizations. e-KYC is also known as know your client or simply KYC. KYC is the process of a business that confirms the identity of its customers and assesses their suitability.

The increase in usage of e-KYC, has improved the services, such as digital payment and digital onboarding which has improved the customer’s experience and has driven the growth of digital verification across the globe. The term e-KYC is also used to describe the digitalization of KYC processes and the electronic and online conception of the same. The remote, paperless process which minimizes the costs and traditional bureaucracy that is needed in KYC processes is called e-KYC, i.e., Electronic Know Your Customer). Specialist companies that are engaged in technological compliance solutions have developed completely secure e-KYC. They have developed completely secure e-KYC processes with zero margins for the commission of these fake offenses and related crimes.

e-KYC Market: Overview

e-KYC market  is expected to expand at a CAGR of 24.5% rising to a value of USD 278,380 Million in 2033, i.e., forecast period (2023-2033).

Decrease in paperwork and reduction in the turnaround time of completing KYC formalities online in a few simple steps, real- time are the key factors for the growth of the market. Additionally, government regulators have focused on monitoring and regulating the digital currency to cut off the anonymity in transactions and the transfers of cross-border funds are projected to increase the demand for e-KYC across India in the near future. Also, the increase in use of remotely verified e-KYC throughout the world in order to reduce the financial institutions' costs is reinforcing market growth.

Additionally, increasing AI and machine applications in analysing a massive amount of data generated through digital currency transactions and to help to reduce the number of false alerts is also anticipated to drive demand for e-KYC in the forecast period. The growth of the market can also be attributed to the growing demand in legal and financial institutions for the increase in need of Know Your Customer (e-KYC). The increasing adoption of digital payment modes and the use of sophisticated analytics in order to provide proactive risk warnings can drive market growth.

e-KYC Market: Key Trends

·         Stringent government regulations to prevent money laundering and financial fraud

Terrorist financing activities and huge monetary losses in the banking, financial services, and insurance (BFSI) sectors are the factors that are expected to drive the growth of the e-KYC market. In addition, it is also projected that the increase in importance of compliance management and the increase in number of identity-related frauds will also drive the growth of the market.

Additionally, the increase in incidence of cyber-attacks against small and medium-sized enterprises (SMEs) has helped the growth of the market. In addition, increasing adoption of the cloud, increase in internal and external threats, and the Internet of Things (IoT) are some of the factors projected to boost the growth of the target market.

·         Increasing Adoption of Digital Payment Modes

Technological advancement has opened up possibilities for digital currency as well as digital payments from the central bank. If we consider the example of mobile payments, it is seen that mobile payments are becoming increasingly common in India and there is a reduction in the frequency of using cash. Additionally, the market is expected to gain traction in the near future with the onset of connected things, cloud computing, and Artificial Intelligence. The increasing need to reduce the unauthorized use of credentials and reduction in the violation of conduct is likely to pave the way for the e-KYC market to grow over the forecast years.

Impact of COVID-19 on e-KYC Market

Most of the businesses have faced a growing petition of business-critical concerns that are related to the Covid 19, that includes supply chain disruptions, a risk of recession, and a potential drop in customer spending. The COVID-19 has increased the need for contactless financial product and services which has accelerated the shift to digital finance in many economies. Data collected during pandemic has been shift to digital payments. CoVID-19 has been an important driver of financial inclusion. The global pandemic crisis, such as restricting economic activities and lockdowns has been the key factor in the growth of the market. In some cases, Covid 19 provides an opportunity to accelerate progress towards broader and acceptance of digital alternatives.

e-KYC Market: Segmentation Analysis

e-KYC Market on the basis of Deployment mode

·         Cloud- based

·         On- premise

e-KYC Market on the basis of deployment mode is segmented into on-premise and cloud-based. The On-Premises segment is expected to lead the market with a great revenue share. It is because of the organization's on-site benefits of using their server to ensure data security. It is seen that in the forecast period, the cloud will expand at a significant pace, which is because of the SaaS-based e-KYC solution from the company that allows cost-effective access to the cloud-based implementation of the e-KYC solution.

On the basis of End-User

·         Banks

·         Financial Institutions

·         E-Payment service provider

·         Telecom companies

·         Government entities

·         Insurance companies

The bank market segment is projected to be the most significant revenue contributor in the global market for e-KYC and is expected to retain its dominance in the forecast years. Because of the increasing use of e-KYC in order to optimize customer onboarding by validating KYC documents online and the improvement of efficiency payment collections, eliminating documentation in the procedure of loan applications, and the attempt to prevent identity fraud, the bank segment has accounted for the largest revenue share.

On the other hand, the Financial Industry segment had a good market share for e-KYC and is expected to contribute to economic growth during the forecast period due to e-KYC that will contribute to remote client onboarding and effectively prevent compliance and risk evaluation of anti-money laundering conformance and risk evaluation.

On the basis of Product

·         Identity Authentication and matching

·         Video Verification

·         Digital ID Schemes

·         Enhanced vs Simplified Due Intelligence

e-KYC Market: Regional Segmentation

In terms of region, North America has the largest revenue in the market. The increasing requirement for fraud detection in countries, such as Canada and the United States is accountable to the market share for e-KYC. Also, the rise in data theft and cyber-attack cases in small and medium-sized businesses is expected to rise the market growth of the e-KYC over the forecast years. Asia-Pacific is also anticipated to witness a high CAGR in the global market for e-KYC. Growing internal and external threats, rising cloud use, and the Internet of Things (IoT) has also contributed to e-KYC market expansion in this region.

Competitive Landscape

E-KYC market is highly competitive and it consists of several major players, such as Acuant, GIEOM Business Solutions, IDnow GmbH that holds a considerable market share in the E-KYC market. Other players that can be analysed can be Trust Stamp, Mitek, 63 Moons Technologies Ltd., Au10tix, Onfido, EverCompliant, C-Edge, Pegasystems Inc.,  Financial Software and Systems Pvt. Ltd., GB Group, Jumio, Panamax Inc., Tata Consultancy Services (TCS), Trulioo, and Wipro Technologies among other key players.

Key Players: Acuant; Trust Stamp; Pegasystems Inc.; Mitek; Jumio; Trulioo; Onfido; GB Group; IDnow GmbH; C-Edge, Financial Software & Systems Pvt. Ltd.; GIEOM Business Solutions; Panamax Inc.; Tata Consultancy Services; Wipro Technologies; Au10tix; EverCompliant.