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IFC to support BB for introducing eKYC system

  • Staff Correspondent
  • 26 October, 2021 12:00 AM
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IFC to support BB for introducing eKYC system

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International Finance Corporation (IFC) will support Bangladesh Bank for scaling up electronic Know Your Customer (eKYC) project, a digital process to register new customers.

Bangladesh Financial Intelligence Unit (BFIU) under central bank recently came to an agreement with IFC for developing the system to increase access to a formal financial system, Abul Kalam Azad, general manager at BB, told the Daily Sun.

The electronic KYC is the remotest and paperless process of instant verification with national identity database which minimises the costs and reduce other hassles in getting necessary information about customers.

In a statement on Monday, BB informed that IFC and BFIU will work together to develop and adopt eKYC infrastructure, which is a foundational regulatory arrangement for conducting customer due diligence during new client on boarding process.

The project will contribute to the financial inclusion agenda of the government of Bangladesh as well as IFC’s target of including an additional 30 million unbanked adults in the country by 2030.

Along with establishing a regulatory infrastructure, the project will also deliver data analytics, case studies, knowledge creation and dissemination and awareness building in the financial market.

IFC estimates that 500,000 people will be covered by the e-KYC system by end of the project implementation period in 2025 after concluding the project in December 2024.

BB executive director Masud Biswas said the digital transformation enables easy access of customer, even from the remote location, into the financial services.

“This may pose some underlying risk of money laundering, terrorism financing and related criminal activities by abusing financial institutions and its services. To minimize such risk of financial sector e-KYC can be one of the most optimal solutions,” said Masud, an executive director at BB, said.

IFC regional manager Qamar Saleem said the the implementation of eKYC infrastructure will offer seamless experience for end users and support the financial sector to reach out to last mile customers in Bangladesh, significantly increasing access to financial services.

IFC helps advance financial inclusion through investments in the financial sector, advisory services to investment clients and other private sector clients, and through advisory services to stakeholders in financial infrastructure.

Earlier, for conversion from manual KYC to eKYC, BFIU ran a small-scale testing by opening 1,500 accounts using eKYC technology, such as biometrics, and the results confirmed its effectiveness.