INTRODUCTION

About PDAX

Philippine Digital Asset Exchange (PDAX) is a cryptocurrency trading platform founded in 2018. PDAX is tailored for the Philippine market, allowing users (novices & seasoned traders) to buy, sell & trade crypto currencies at competitive global market prices. It is a trusted platform among Filipino crypto users, as it is licensed and regulated by the Bangko Sentral ng Pilipinas. PDAX aims to bridge the gap between traditional finance and the digital economy, democratising access to a broader range of financial services. This will effectively aid in growing the wealth of the Filipinos

The Problem

Lack of Effective Regulations:

The cryptocurrency industry is complex, nascent & dynamically changing. The current regulatory framework is evolving with regulators working to gain a comprehensive understanding of the sector to devise appropriate & effective regulations. At present, the foremost challenge for crypto based companies is to establish and maintain a compliant system amidst the chaos.

Lack of a Uniform National ID System:

The Philippine market is unique as they had a national ID card system rolled out only in 2020. So, there are a variety of IDs issued by different government institutions with different security features. So, the challenge here is the inconsistency of the card formats which increases the risk of having customers with fake/illegitimate documents.

Increase in Frauds:

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There has been a rise in the number of onboarding attempts using fake or unreliable IDs.

Michelle Regala-Niebres
VP, Compliance

Working as a fully digital company without any actual physical office, it is important for PDAX to not just onboard more customers to their platform rather than onboard legitimate customers. This is very crucial as it has serious implications, like penalties from the regulators’ side and it affects the trustworthiness of the company from the customers’ side.

Cumbersome Experience with the previous partner:

To tackle these challenges, PDAX partnered with a Philippine based KYC verification partner. However they were not satisfied with their technology & the support provided.

It is in this juncture, PDAX was on a lookout for an efficient e-KYC verification partner.

Key Expectations from an e-KYC Partner:

Some of the key expectations which PDAX had for the new partner was

  • To support multiple ID documents
  • To handle volume
  • To have seamless customer experience
  • To match the compliance requirements of regulators

Solution

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We were surprised and amazed to discover the variety of identity documents from the Philippines market that HyperVerge could recognize and accurately verify.

Michelle Regala-Niebres
VP, Compliance

Through its partnership with HyperVerge, PDAX was able to screen the customers at the beginning of the onboarding journey making it more efficient & effective. PDAX uses the following during the screening process:

  1. OCR:
    HyperVerge provides support for 11 different ID cards in the Philippines, due to the country’s absence of a unified national ID system. HyperVerge utilises AI models to recognise various templates, facilitating advanced quality checks for compliance assurance.

  2. Liveness:
    This involves using algorithms to confirm that a video or image is genuine and not merely a photo of another photo. HyperVerge achieves this through ‘Single Image Passive Liveness’ technology, which requires only a single selfie, unlike active liveness methods that demand complex user gestures.

  3. Face Match:
    Using vectorized coordination, HyperVerge effectively matches an individual’s selfie to the photo on their ID, ensuring they are the same person. This places HyperVerge 4th globally and at the top in the USA and India on the National Institute of Standards & Technology’s Face Identification Leaderboard.

  4. Face De-Duplication Check:
    This involves comparing an incoming face’s features and associated metadata against the clients database of previously enrolled applications.If the new entry’s features match those in the database, it’s flagged as a duplicate. If they don’t match, the entry is considered suspicious. Additionally, the system checks for any similarities with faces on a blocklist. If a resemblance is found, it’s flagged in the response. This thorough comparison helps in achieving accurate and fraud-free identification..

Impact:

Volume & Capability:

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We are glad to see that HyperVerge has been able to respond to the influx of onboarding volume.

Michelle Regala-Niebres
VP, Compliance

Even with a huge influx of customers, HyperVerge tackled the challenge of multitude of IDs in place with the customers during onboarding. PDAX was surprised with the capability of HyperVerge to not just accommodate a range of IDs but also accurately identify the illegitimate documents. Onboarding legitimate customers is super important for PDAX as it ensures building trust among customers & credibility among regulators. 

KYC & Liveness check:

Since the partnership with HyperVerge, there has been a significant improvement in efficiency. The time required for ID card validation has been reduced to 3.59 seconds, liveness checks to 1.13 seconds, and face match processes to just 0.97 seconds.

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With HyperVerge we can give our customers a more seamless KYC onboarding process.

Terese Tuballa
AVP, Head of KYC

Partnership with HyperVerge:

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The HyperVerge team is extremely responsive, attentive, and collaborative.

Terese Tuballa
AVP, Head of KYC

PDAX was impressed with the HyperVerge team’s proactiveness, reliability, and collaborativeness and stated that it set us apart from their previous partners. This distinction has led to an expanded collaboration with PDAX, going beyond e-KYC verification. We are working to improve the overall customer experience, share relevant tools that might help PDAX in their upcoming pipeline and so on.

Engagement Highlight – HyperVerge ONE Platform

PDAX wanted to expand their business and acquire customers outside of the Philippines. However they did not have bandwidth to create onboarding workflows for different geographies.

Their existing use of HyperVerge ONE platform was advantageous. The platform,  supporting identity documents from over 190 countries, enabled PDAX to effortlessly create tailored workflows for different regions. The integration was efficient  and hassle-free, eliminating the efforts needed on PDAX’s front end system and hence cutting down the launch time by half. 

The Journey Ahead

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We know that we can always turn to HyperVerge for help, whether it be for technology or for insightful ideas – allowing us to make informed decisions on our product roadmap.

Terese Tuballa
AVP, Head of KYC

PDAX is currently working on new product lines within cryptocurrency that will help Filipionos grow their wealth. This translates to HyperVerge being a pillar in handling things at scale. The impact of the engagement will be much larger in the future.

Executive Summary:

Significant improvement in efficiency for KYC:

3.59 seconds

for ID card validation

1.13 seconds

for liveness checks

0.97 seconds

for face match

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