Due to advancements in technology, most aspects of life evolve now into something more digital with every passing day such as communication, entertainment, and business.
With digitalization becoming the hot trend people are gradually incorporating into their lives, businesses and companies look to capitalize on making new products and services to aid humanity ever more into living happier, more comfortably, and efficiently.
However, even the bad aspects of life such as crime are being technologically influenced making criminals commit more cybercrime each year. More $1.4 billion dollars were lost due to identity fraud cases in 2018 according to the Federal Trade Commission.
Identity fraud, a crime where the victim’s identity is misused for the criminal’s benefits, can be easily tackled by incorporating effective security checks in times and places where the identity of a person must be verified before an action takes place such as a purchase or an opening of an account.
Law enforcement bodies, therefore, make these kinds of checks mandatory for businesses and financial institutions through KYC and AML compliance in order to prevent a business from being done with troublesome individuals with ties to fraud, money laundering, terrorist financing, and other crimes.
Lacking necessary security measures disobeys these laws which result in hefty fines for putting people’s money and data at risk.
High-tech security services exist for this purpose to make this identity verification checks seamless and automated where traditional methods are time-consuming and contain human error due to it being a manual process.
One of the most effective ways for a customer or user to verify themselves is through document verification. And with technology, digital document verification paves the way for businesses and companies into making security checks faster and smarter.
How does digital document verification work?
Document verification takes place when a user presents their original government-issued documents such as an ID card or passport to an expert.
The document is examined and cross-checked with the registered data while making validity checks for genuine features like holograms, hidden symbols, and watermarks, etc.
The digital document verification process, unlike its traditional counterpart, makes the procedure simpler and quicker without the user needing to travel to an office for their identity verification.
Using their device, they can present their official identity documents in front of a camera for it to be scanned and processed. The AI-powered OCR identifies the document’s data and extracts them into a digital format where it can be examined and matched with the entered user information.
The OCR also makes the necessary feature checks to prevent fraudsters from making use of photoshopped counterfeit documents in order to pass off as their victim.
While this process may be performed automatically through software and AI, Video KYC is possible as well where a KYC expert conducts the verification process virtually through live call and can use human intelligence to cover where software lacks such as judging the person’s responses and behavior to catch identity thieves in their tracks.
How do businesses profit from document verification?
Making necessary security checks in a digital age must be a seamless and user-friendly process where any customer can be verified. The high-efficiency, accuracy, and smoothness of the procedure make the customer feel more secure and appreciative when using a business’s services.
Especially with the check being completed in a matter of seconds is what keeps a customer happy and the image of business more positive and high-tech.
It saves both buyers and sellers the threat of scams and fraud and protects their money and information from being stolen from sharp cybercriminals. The world of business gradually is realizing the importance of fintech and cybersecurity.
The identity verification market is reported to possibly reach $12.8 billion by 2024 with a Compound Annual Growth Rate (CAGR) of 16.0%. This speaks volumes about the interest and investment being put into making businesses more advanced and secure.
Why is ID Verification needed by modern businesses?
Need for Verification
The boundary between a person’s physical identity and their digital identity has been greatly reduced thanks to the advancement in cyberspace technology. The introduction of the digital marketplace has totally revamped our lives by allowing us to get products and services online.
However, alongside numerous benefits, there are drawbacks to the internet also. The entire world is connected via the web which unfortunately makes it vulnerable to threats from cybercriminals and scammers throughout the world.
They hide their identities and anonymously perform various fraudulent and spamming activities on the web, causing huge losses of billions of dollars across the world.
To reduce the instances of a scam, regulatory authorities have devised regulations that help within the identification and verification of the members of the web community. Enforcement agencies have also introduced laws that diminish the danger of fraudulent activities within the cyber world and the physical world.
Identity Verification is increasingly becoming an important component of Know Your Customer (KYC) regulations. The key purpose of KYC regulations was to limit concealment and terrorist financing when it had been introduced within the late 1990s within the US.
Taking a leaf out of the US book, the Federal Reserve Bank of India too directed all banks to implement KYC guidelines for all new accounts by 2004. Due to its importance, ID verification has been around for many years especially after the worldwide rate of crime increased.
Modern methods of customer identification were devised to endure secure transactions and business operations.
Since all the transactions are administered through financial institutions and banks, it had been immensely important to integrate KYC into all their systems. Global financial regulatory authorities like FATF, FinCEN GDPR, FINMA, Cyber Essentials, PCI DSS, etc have made it obligatory for all financial institutions to suits the KYC and AML regulations.
Businesses are also encouraged to follow these guidelines for added security. Thanks to the evolution of the web and the resulting cybercrime, the previous sorts of identity verification do not seem effective.
Although the contemporary methods of identification are considered more authentic and safe, fraudsters consistently search for newer ways to by-pass the safety barriers set by the regulatory bodies.
A deep dive into Digital IDV Solutions
Modern technological firms are racing with one another, trying to bring up with newer innovations to automate the prevailing identity authentication services techniques.
Many have adopted cutting-edge AI technology to determine if the individual, in reality, is who he/she claims to be or not. This technology is fast, reliable, and secure, and has stopped many cybercriminals from getting access to the system.
This digital biometric identification solution would allow you to verify your identity in a wide selection of scenarios; from checking in to a guest room you’ve got booked earlier or unlocking the doors of a car you rented, etc.
All of this using your device’s camera. The need for a password might be eliminated altogether. The entire process will only take a few seconds to finish and requires only a webcam or smartphone.
Some of the online ID identification services are facial recognition, document validation, address authentication, consent verification, and 2-factor authentication. You can select the service according to your need and requirements.
For example, a business might want to get facial verification services, while a govt office might opt for document verification. Each of these services has different prices and they can even be customized as per customer needs.
It is certain that the solution to fraud prevention doesn’t exist. It takes a lot of research, investment, effort, and innovation to secure your systems and accounts. Together when these techniques and attributes are organized and invoked, they can help create a replacement frontier of authentication and identity management.
Scammers and hackers are quick to evolve their evil schemes, therefore businesses and individuals got to stay a step before them to remain safe and secure.