Federated learning for kyc process1.pptx

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1. Federated Learning

2. KYC (Know Your Customer) KYC  refers to the process through which a business verifies the identity of its clients to ensure they are who they claim to be. It is a fundamental practice in financial services, particularly for banks, payment providers, and other institutions that handle money. The primary objectives of KYC are: Compliance : Adherence to laws and regulations to prevent illegal activities such as money laundering, terrorism financing, and fraud. Risk Management : Assessing the risk associated with a customer to safeguard the institution from potential losses. Customer Identification : Ensuring that the person engaging in financial transactions is accurately identified. KYC Process: Customer Identification Program (CIP) : Collecting basic information like name, address, date of birth, and identification numbers (e.g., passport, social security number). Customer Due Diligence (CDD) : Conducting background checks to verify the provided information and assess the customer's risk level. Enhanced Due Diligence (EDD) : Implementing more rigorous checks for higher-risk customers, such as politically exposed persons (PEPs) or customers from high-risk countries.

3. Digital Identity Digital Identity  refers to the online or networked identity adopted by an individual, organization, or device. In the context of global wallets, digital identity is crucial for: Authentication : Ensuring that the person accessing the wallet is the legitimate owner. Authorization : Providing permissions and access controls based on the verified identity. Transaction Security : Protecting against unauthorized access and fraudulent transactions. Components of Digital Identity: Personal Information : Name, date of birth, address, and other personally identifiable information (PII). Credentials : Usernames, passwords, PINs, and biometric data (fingerprints, facial recognition). Digital Certificates : Encryption keys, digital signatures, and tokens that verify identity in digital interactions.

4. Integration of KYC and Digital Identity in Global Wallets Global wallets, such as those used for cryptocurrencies, online banking, or digital payments, leverage KYC and digital identity to create a secure and compliant environment. Here's how they are integrated: Onboarding : During account creation, users must complete the KYC process by providing necessary identification documents and information. This helps verify their identity and assess any associated risks. Verification : Digital identity technologies, such as biometric authentication (fingerprint, facial recognition) and two-factor authentication (2FA), are used to ensure ongoing verification during transactions and account access. Monitoring and Compliance : Continuous monitoring of transactions and user behavior is conducted to detect suspicious activities and ensure compliance with regulatory requirements. By integrating KYC and digital identity, global wallets can provide a secure, efficient, and regulatory-compliant service to users, fostering trust and protecting against financial crimes.