Designing a Framework for Digital KYC Processes Built on Blockchain-Based Self-Sovereign Identity
Designing a Framework for Digital KYC Processes Built on Blockchain-Based Self-Sovereign Identity
Vincent Schlatt,Johannes Sedlmeir,Simon Feulner,Nils Urbach
TLDR
This work demonstrates how blockchain-based self-sovereign identity (SSI) can solve the challenges of KYC, and follows a rigorous design science research approach to create a framework that utilizes SSI in the KYC process.
Abstract
Know your customer (KYC) processes place a great burden on banks, because they are costly, inefficient, and inconvenient for customers. While blockchain technology is often mentioned as a potential solution, it is not clear how to use the technology's advantages without violating data protection regulations and customer privacy. We demonstrate how blockchain-based self-sovereign identity (SSI) can solve the challenges of KYC. We follow a rigorous design science research approach to create a framework that utilizes SSI in the KYC process, deriving nascent design principles that theorize on blockchain's role for SSI.