Major Banks, Regulators Trial ‘Know Your Customer’ App on R3’s Corda

A group of banks and regulators, including big names like BNP Paribas and Deutsche Bank, have conducted a trial of a know-your-customer (KYC) compliance application built upon R3’s Corda blockchain platform.

The 39 participants put the app – built by New York-based tech firm Synechron – through a four-day test using 45 nodes in Microsoft Azure, according to a press release. Ultimately, the group managed to conduct over 300 transactions in 19 countries across eight timezones.

The app’s self-sovereign design is aimed to allow firms’ customers to build and maintain their own identities, as well as enable them to approve or reject access requests from banks. When customers updated their data in the test, this was automatically updated for any banks with access permission.

R3 said in the statement:

“Traditional KYC processes are complex and often duplicative. This self-sovereign model allows corporate customers to create and manage their own identities including relevant documentation and then grant permission to multiple participants to access this data”

According to R3, this can lead to improved efficiency and lower costs at financial institutions by “eliminating the need for each institution to individually attest and update KYC records.” The model could also help avoid data privacy and security problems, since only parties with the need to see the data will have access to it, and only those with permission from the customer.

“Not only does this project demonstrate how blockchain can allow institutions to retain control of and manage their own identity,” said David Rutter, CEO of R3, “but it also validates the design choices we made in our approach to privacy on Corda.”

Also involved in the trial were ABN AMRO, Societe Generale, China Merchants Bank, ING, Raiffeisen and many more. Meanwhile, the regulators and central banks participating included the Central Bank of Colombia, the Federal Reserve of Boston and the Superintendency of Banking and Insurance of Peru.

Passport and bank cards image via Shutterstock