A huge swath of the African population lacks any form of identification. This makes it difficult for financial institutions and other companies to conduct KYC (know your customer) protocols and the issue spills into various facets of life, leading to financial exclusion and denial of government services.\n\nKYC guidelines, including government regulations, are meant to prevent unlawful access to the banking system and typically include anti-money laundering requirements such as verification of customers\u2019 identity, and assessing their risk factors. KYC protocols also are used by a variety of companies to prevent fraud and theft.\n\nMore generally, all sorts of interactions with enterprises like banks and insurance companies require some form of identification, which in turn makes the onboarding experience difficult for many customers.\n\nIn countries that have official forms of identification, they are typically paper-based, which makes them difficult to use for businesses using newer, digital services.\n\nThe growing threat of identity theft has also left many institutions without the appropriate tools to do proper KYC checks.\n\nHowever, technology including mobile phones, aided by internet penetration, is opening up opportunities for start-ups to offer KYC solutions to businesses across the continent.\n\n\u201cEfforts to improve national identification systems in African contexts have coincided with the increasing deployment of mobile technology, leading to some actors promoting digital \u2018solutions\u2019 for facilitating forms of identification and registration \u2013 often via biometric attributes,\u201d according to a report by Research ICT in Africa. The report estimates that 500 million people in Africa lack a form of identification.\n\nThe same report said that digital identity can enable enterprises to improve service delivery, as well help individuals by enabling them to be visible to the state and therefore be eligible for services.\n\nEven though Africa is yet to see a major undertaking in fully digitizing identity, there are some companies that are already making impact in the private sector, enabling companies to fulfil their KYC mandates. Here are the top six.\n\nYouVerify\n\nYear Founded:\u00a02017\n\nHeadquarters:\u00a0 Lagos, Nigeria\n\nFounder: Gbenga Odegbami\n\nWhat they do: \u00a0One of the biggest issues that financial institutions deal with in Africa is the lack of proper documentation for their clients and the leaves leeway for fraud. Youverify is a digital solution that gives enterprises such as banks the ability to identify customers. Its identity access management enables financial institutions to be efficient in disbursing services without worrying about identification issues. YouVerify draws on big data from telecommunications companies and government institutions to confirm identities of clients. See their story here.\n\nCompetitors include: VerifyMe\n\nCustomers: Mostly banks and financial institutions\n\nWhy they\u2019re a top KYC company: The use of big data from telecommunications companies and some government agencies has highlighted the usefulness of this information for identification purposes. The company's platform helps in financial inclusion as it streamlines the KYC process for busy enterprises like banks.\n\nSmile Identity\n\nYear Founded:\u00a02017\n\nHeadquarters:\u00a0 San Francisco\n\nFounder: Mark Straub\n\nWhat they do: \u00a0Smile Identity is a US-based but Africa-focused digital identity start-up looking for ways to introduce identification metrics in a continent that lacks universal IDs. The company provides real-time digital KYC, identity verification, user onboarding, and user authentication across Africa. Using machine learning and artificial intelligence, the platform provides face detection, face verification and face deduplication suited for African faces. \n\nCompetitors include:\u00a0YouVerify, VerifyMe Nigeria\n\nCustomers: Payment companies, financial institutions including digital banks and telecoms.\n\nWhy they\u2019re a top KYC company: Smile Identity ID Validation covers over 250 million identities across Africa. They have partnered with growing companies such as Chipper Cash, Paystack, Paga, Flutterwave and Kuda.\n\nVerifyMe\n\nYear Founded:\u00a02013\n\nHeadquarters:\u00a0 Lagos, Nigeria\n\nFounder: Esigie Aguele\n\nWhat they do: \u00a0Fraud detection is a much-needed solution for the financial industry in Nigeria, Africa's most populace country. VerifyMe uses facial recognition solutions to enable banks to conduct contactless account opening and onboarding of new clients. The company also offers credit score services for banks and financial institutions, in the loan approval process.\n\nCompetitors include:\u00a0YouVerify\n\nCustomers:\u00a0 Banks and financial institutions.\n\nWhy they\u2019re a top KYC company: Firms can also conduct a know-your-employee process using VerifyMe\u2019s OneIdentity report, built on the largest work history database in Nigeria.\n\nIdentityPass\n\nYear Founded:\u00a02021\n\nHeadquarters:\u00a0 Lagos, Nigeria\n\nFounders: Lanre Ogungbe, Niyi Adegboye and David Obi\n\nWhat they do: Identitypass is a digital compliance and security company. It offers businesses a platform on which they can validate the identities of customers they interact with. According to the company, identity theft increased by 53% from 2019 to 2020 and continues to increase.\n\nCompetitors include:\u00a0VerifyMe, YouVerify, Smile Identity\n\nClients:\u00a0 Financial institutions\n\nWhy they\u2019re a top KYC company: IdentityPass uses face recognition technology and integrates data from national identity cards, voter cards, and driving licenses to ascertain the identity of customers. Their technology is also designed to protect users from having their identities stolen.\n\nThisIsMe\n\nYear Founded:\u00a02013\n\nHeadquarters:\u00a0 Cape Town, South Africa\n\nFounders: David Thomas,\u00a0Juan Furmie,\u00a0Nadeem Shahid\n\nWhat they do:\u00a0 ThisIsMe provides companies with a way to onboard customers and automate background checks. They use trusted global sources, biometric and social media data points to identify people in real-time, according to the company. ThisIsMe offers individuals a way to control their identity data and verify people when interacting online.\n\nThe firm also is unique in identifying corporate and business entities and ascertaining their data. They verify incorporation information, financial licenses, creditworthiness, directors and beneficiaries and check them against watch lists.\n\nCompetitors include:\u00a0Smile Identity\n\nCustomers:\u00a0 Individuals and corporates\n\nWhy they\u2019re a top KYC company: The firm has been able to work with big corporates to ease onboarding and KYC requirements. The firms include Old Mutual, Stanlib, Sanlam, Marriot and BET.co.za.\n\nBACE Group\n\nYear Founded:\u00a02018\n\nHeadquarters:\u00a0 Accra, Ghana\n\nFounders: Arinze Christopher, Charlette Desire, Jean Cedric Attiembonon, Samuel Sowah Mensah\n\nWhat they do: \u00a0BACE enables financial institutions to do due diligence on their customers using facial recognition. The company allows users to take a selfie, which is matched with the official ID of the person to ensure their identities. The company offers an API service that allows companies to configure their own identification checks.\n\nCompetitors include:\u00a0Smile Identity\n\nCustomers:\u00a0 Financial institutions, event managers, educational institutions.\n\nWhy they\u2019re a top KYC company: Complete with facial recognition, BACE Group also uses artificial intelligence in processing data points that it collects. Its use of smartphone selfies could appeal to the younger generation.