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Telcos contactless KYC plan hits security roadblock

Telecom operators’ plans to launch a fully contactless, online customer acquisitions process in times of Covid has hit a security roadblock.

The Department of Telecommunications (DoT) and the home ministry have not yet cleared telcos’ plans to digitally authenticate a customer’s identity, address and photographs due to concerns around the veracity of such documents required under the e-KYC (electronic-know your customer) parameters.

“We have shared the proposed contactless e-KYC process (template) with DoT, but some security-related concerns of both DoT and home ministry remain unresolved around ensuring that documents shared online for establishing a new mobile user’s ‘proof of identity’ and ‘proof of address’ are genuine, besides also ensuring that photographs taken by the contactless activation system are not morphed or edited in anyway,” a senior industry executive aware of the matter told ET.

Telcos though, he said, plan to shortly allay DoT and home ministry’s concerns around security in a contactless e-KYC process. But talks would resume only after clarity emerges on the business implications of a likely easing of the nationwide lockdown, post-May 17.

The contactless mobile activations proposal has also been hanging fire in absence of a satisfactory solution to ensure timely physical home delivery of mobile SIMs or `connections’ during the lockdowns. Telcos have been exploring ways to ensure safe and hygienic physical delivery of SIMs at customers’ homes though vendors/couriers under the proposed online activations system.

At press time, Bharti Airtel, Reliance Jio and Vodafone Idea did not reply to ET’s queries.

With the Covid-19 unlikely to go away anytime soon, the phone companies are keen to push for a contactless mobile user activations system, which would boost mobile SIM sales as customers could then be onboarded online without them having to turn up at mobile retail stores to buy a connection. Such a system, is also expected to cut a telco’s customer activations costs and eventually help reduce its physical mobile stores footprint.

Rajiv Sharma, research head at SBICap Securities, though said “overall cost reductions would be marginal as any savings in employee/admin costs under a contactless user activations process would be partly offset by SIM home delivery costs that the telco will have shoulder”.

Industry executives though say that consumers capable of buying connections online should enjoy the contactless activation option during the corona outbreak, while folks without access to smartphones, desktops or laptops should be able visit physical retail outlets to buy a mobile SIM.

They, in fact, say this will be possible once more mobile stores open with the likely relaxations in Covid-quarantine conditions to kickstart the economy.

The call for a contactless SIM sales mechanism comes at a time when telcos have been struggling to get new customers amid lockdowns. According to industry estimates, the three carriers collectively added only 500,000 new customers in March against 2.5- 3 million monthly adds in normal times.

—Gadgets Now

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