Video KYC (Know Your Customer) has become a cornerstone of secure digital onboarding, and it is growing at an exponential pace, especially in the BFSI industry vertical. Between 2019 and 2026, the global video KYC market is expected to nearly triple in size, reaching USD 500 million by 2026. This growth will be driven by a CAGR of 14.9%.
Video KYC (Know Your Customer) has become a cornerstone of secure digital onboarding, and it is growing at an exponential pace, especially in the BFSI industry vertical. Between 2019 and 2026, the global video KYC market is expected to nearly triple in size, reaching USD 500 million by 2026. This growth will be driven by a CAGR of 14.9%.
At the same time, with the latest advancements in AI, deepfakes pose a new challenge for the industry and give rise to new types of fraud. The pace and cost at which deepfakes can be created have decreased drastically, imposing a significant threat to enterprises which use video KYC as a mechanism for onboarding and authentication.
A recent close call at Zerodha, a major Indian stock trading platform, serves as a stark reminder of the evolving threats to video KYC (Know Your Customer). A customer narrowly avoided losing Rs 1.80 lakh due to a deepfake scam, highlighting the growing sophistication of fraudsters. As Zerodha CEO Nithin Kamath pointed out, the rise of AI-powered apps that create deepfakes is contributing to a surge in such attacks.
The growing prevalence of deepfakes, hyper-realistic manipulated video, throws a wrench into the once-reliable video KYC process. Let's explore how deepfakes could impact video KYC, different use cases for malicious actors, and the potential consequences for various industries.
Deepfakes leverage artificial intelligence to create fake audio and videos which can impact the know your customer(KYC) process in a massive way and create new challenges for the law enforcement and enterprises. Imagine entirely replacing someone's face in a live video call with another person and opening a bank account. Using deepfake nefarious elements could: Create fake identities: Deepfakes could be used to impersonate real people, allowing fraudsters to open accounts or steal identities.
The potential impact of deepfakes on video KYC is particularly concerning for industries heavily reliant on secure customer onboarding and authentication. Here's a closer look at the risks for three key sectors:
1.Banking:
2.Insurance:
3.NBFCs (Non-Banking Financial Companies):
4.Online retail and marketplace:
5.Government services:
Deepfakes pose a significant challenge to the security and integrity of video KYC (Know Your Customer) processes. However, there are strategies we can employ to mitigate these risks and maintain a robust verification system. Here's a strategy leveraging Authentify, an AI-powered deepfake detection tool, alongside other measures:
Level 1: Mitigate risk through proper awareness, basic liveness checks during video recording, combining video KYC with document verification
Level 2: Deepfake detection with Authentify by integrating Authentify's AI engine into your video KYC workflow; Authentify’s content score can be used to trigger further verification steps for high-risk cases
Level 3: Continuous improvement with regular evolution of Authentify using the data sets usage of AI++ by collaborating with industry peers and security researchers at Authentify
The future of video KYC lies in a collaborative effort involving technology developers, regulatory bodies, and all stakeholders working together to guarantee secure and trustworthy digital onboarding processes. While deepfakes pose a challenge, they can also be a catalyst for developing even more sophisticated verification methods.
Authentify will help enterprises ensure video KYC remains a reliable guardian against fraudsters, paving the way for a secure and trustworthy digital future.
Law enforcement and judicial systems also need to mature and create frameworks to draft regulations and rules for what can be accepted as the right proof of deepfake-related frauds for conviction.
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