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Know Your Customer: Balancing Innovation and Regulation for Financial Inclusion

Lookup NU author(s): Professor Karen ElliottORCiD, Kumaran CoopamootooORCiD, Edward Curran, Dr Paul EzhilchelvanORCiD, Dave Horsfall, Dr Magdalene Ng, Dr Tasos SpiliotopoulosORCiD, Han Wu, Professor Aad van Moorsel



This work is licensed under a Creative Commons Attribution 4.0 International License (CC BY 4.0).


Financial inclusion depends on providing adjusted services for citizens with disclosed vulnerabilities. At the same time, the financial industry needs to adhere to a strict regulatory framework, which is often in conflict with the desire for inclusive, adaptive, privacy-preserving services. In this paper we study how this tension impacts the deployment of privacy-sensitive technologies aimed at financial inclusion. We conduct a qualitative study with banking experts to understand their perspective on service development for financial inclusion. We build and demonstrate a prototype solution based on open source decentralized identifiers and verifiable credentials software and report on feedback from the banking experts on this system. The technology is promising thanks to its selective disclosure of vulnerabilities to the full control of the individual. This support GDPR requirement, but at the same time, there is a clear tension between introducing these technologies and fulfilling other regulatory requirements, particularly with respect to ‘Know Your Customer.’ We consider the policy implications stemming from these tensions and provide guidelines for the further design of related technologies.

Publication metadata

Author(s): Elliott K, Coopamootoo K, Curran E, Ezhilchelvan P, Finnigan S, Horsfall D, Zhichao M, Ng M, Spiliotopoulos T, Wu H, van Moorsel A

Publication type: Article

Publication status: Published

Journal: Data and Policy

Year: 2022

Volume: 4

Online publication date: 14/10/2022

Acceptance date: 22/08/2022

Date deposited: 21/02/2022

ISSN (electronic): 2632-3249

Publisher: Cambridge University Press


DOI: 10.1017/dap.2022.23


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