KUALA LUMPUR (March 29): End-to-end electronic payment solution provider ManagePay Systems Bhd (MPay) is set to ink a tripartite private-academia partnership with MSC Trustgate.com Sdn Bhd and University Malaya's Article Intelligence (AI) Research Lab, aimed at producing a fully home-grown sophisticated know-your-customer (KYC) solution.

In an email interview with theedgemarkets.com, MPay founder and managing director Datuk Chew Chee Seng said the KYC solution is a necessary step for many industries, especially the banking sector, to reduce the risk of identity theft, money laundering, financial fraud and the financing of criminal organisations.

“Digitalisation of KYC has changed the banking paradigm from the physical facility to a mobile phone app, thus pressurising all the aspects of a “digital experience”.

“The main challenge of a fully digital experience is the ability to onboard a customer or client seamlessly while accurately authenticating the data provided to emulate a face-to-face process,” he said.

Chew highlighted that MSC Trustgate is one of Malaysia's Fintech first-movers, while University Malaya’s AI lab’s facial matching and optical character recognition (OCR) technology had allowed both a reduction in manpower and increased speed of onboarding.

“Having recently receiving the thumbs up from Bank Negara [Malaysia] for our eKYC (electronic) practice, we are eager to work with Trustgate and UM’s (University Malaya) AI lab to further deepen the research to include further research into deep CNN, 3D hologram and video KYC.

“This will provide for a start-to-end processing without human touch,” he added, confirming MPay’s commitment to investing funds and acting as an intellectual property (IP) originator for the commercialisation of the research.

Chew said MSC Trustgate together with MPay’s technology software provider Stark Global Sdn Bhd intend to offer this solution, packaged with its multiple implementations in the areas of compliance, risk management, fraud detection, business process management and customer services to financial institutions, large enterprises and the government sector.

Trustgate and MPay, as technology recipients of MIMOS Bhd, will use the MIMOS MyDigital ID framework to build high-assurance solutions for credential onboarding, and subsequent use for online authentication and digital signature computation. 

Trustgate will build identity proofing solutions, based on this MyDigital ID framework, encompassing purely online user interactivity for maximum convenience and self-service kiosks for a higher degree of assurance. 

This initiative is considered to be necessary for digitalisation to be effective, scalable and inclusive; per the objectives of the recently launched Malaysia Digital Economy Blueprint (MyDigital). 

Public and private-sector enterprises would also benefit — in that high-value services can now be constructed atop the foundation of a high-assurance digital identity.

Chew said growth in demand for digital banking is witnessing banks scramble to adapt or risk increase in the customer churn rate.

“Those who have digitalised are already reporting improved operational efficiencies and automation over paperwork at bank branches, thereby also reducing operation cost.

“Trustgate's MyTrust ID, combined with Stark Global's expertise in mobile banking and digital omnichannel commerce solutions, will offer both customised and out-of-box solutions to the banking base, as well as digitalisation of large and small enterprises alike,” he said.

Chew added that MIMOS, the government agency at the forefront of research and development for the national digital ID roll-out, had expressed keen interest to work with this academia-private consortium to increase the accuracy, efficiency and inclusivity of government digitalisation, in line with the recently launched MyDigital blueprint.

He said that as a technology recipient of MIMOS, Trustgate is able to develop a more robust qualified signature using the research element of MIMOS’ MyDigital application platform for both fully online and self-service kiosks' digital onboarding.

“This means industries that require secure and regulatory-compliant eKYC can soon deliver their services fully online as a direct result of the partnership.

“Banks, government agencies and large private enterprises stand to benefit the most,” he said.

On what motivated MPay to invest as an IP originator, Chew said the partnership is geared towards developing UM's research into a marketable form, reducing our reliance on imported technology.

“Similar private-academia partnerships in the US, Europe and India have had significant success — [with] Google and Facebook [being] probably the most recognisable examples.

“We hope that this exercise will encourage more private investment in local research commercialisation and innovation to drive Malaysia’s economy robustly forward into the future.

“While we get to own the commercialised product, University Malaya gets to build the research depth and encourage more students to participate,” he said.

Chew also added that the partnership with MSC Trustgate and University Malaya is an ongoing arrangement periodically enhanced with MPay’s investment.