As the digital world takes over the financial industry, personal identity becomes a greater risk. You probably have heard of identity theft and are aware that it can be damaging, but in the world of finance can also be costly. The increased use of digital platforms opens up organizations to more threats from cybercriminals. If your company deals with sensitive details such as passwords and credit card numbers, it is required to protect yourself from these malicious attacks.
When scrolling through our favorite social media platform and seeing an ad for something we were talking about yesterday. What dark magic is this? How did the site know we discussed how badly we need new hiking boots? In truth, this has much less to do with magic than with data collection by marketing teams, which makes sense because, after all, consumers want their ads tailored toward things they are more likely to buy, not products they never use.
Identity Theft Is a Growing Financial Crime
You may have read a news article or seen a TV show about an identity theft victim. The story usually goes something like this: a person receives a call from their bank saying that someone has drained their entire savings account. Then, they receive a new credit card and immediately max it with purchases without their knowledge. Unfortunately, identity theft is the fastest growing crime and shows no sign of slowing down anytime soon.
The number of victims increases every year, and the cost to businesses is rising as well. In 2016 alone, identity thieves stole over $16 billion from 15 million victims in the United States alone, according to Javelin Strategy & Research!
Identity theft can damage your credit score for several years, requiring you to spend countless hours trying to regain control of your money and your good name. To avoid such issues, you can use identity verification solution services provided by companies like au10tix.com, trusted by reputed companies like Google and PayPal.
Automated Identity Intelligence Service Can Verify Multiple ID Types Simultaneously
Now that you know the basics of identity intelligence services, here is a look at some ways they are helping financial institutions provide better customer service:
- Automated identity intelligence solutions integrated into existing systems offered through Software-as-a-Service (SaaS) allow companies to build them into their existing systems rather than use a separate system for identifying frauds or verifying identities. It allows for a smoother transition for employees and customers because nothing needs to change about how Information is shared. It takes place in an upgraded system in the current banking climate.
- Automated identity intelligence services can verify multiple ID types simultaneously. The financial industry typically deals with people who have various IDs from different countries in the case of immigrants. An Automated identity intelligence solution company supports more documents from several countries and regions. It helps banks and other financial institutions verify documents such as passports and driver’s licenses with ease.
New E-Transaction Channels Are More Vulnerable to Identity Theft
The traditional fraudulent transactions are still happening, but new e-transaction channels are more vulnerable to identity theft than the traditional ones because of the proliferation of mobile devices, increasing online transactions, and a growing number of online payment options. As a result, consumers are looking for new transactional methods and channels.
However, in these new scenarios, there is still a customer who will see a transaction occurring via their Account Aggregation Platform or Mobile Bank Application. Therefore, they would like to be confident that they are conducting the transactions.
An organization processing financial transactions and offering banking services must have a security system to protect its customers from ID theft, card fraud, and financial crimes. Most importantly, if you offer online banking or mobile payments.
Manual ID Verification Is Less Accurate Than Electronic Processing
There are many reasons why human ID verification, performed by customer service representatives, is suboptimal. First of all, humans tend to make mistakes more often than computers. (This is generally true for almost any industry.) The more time you spend manually processing and verifying each ID, the greater the danger.
Even if your reps never make a mistake, there will always be a possibility they miss some small detail while verifying data manually, which can lead to consequences for online banking fraud. Therefore, your software partner should be able to run multiple checks at once with high accuracy. It is where modern ID-processing algorithms come in handy: they can compare your customers’ credentials with hundreds of other databases within seconds—while you would be spending hours on manual work!
Artificial intelligence makes the process much faster and more accurate, which means extra savings.
Conventional, Physical ID Verification Is Costly and Complex
The financial institutions have relied on a network of call centers and contractors to verify their customers’ identities using traditional methods such as government-issued IDs, credit reports, and driving records. However, these methods are time-consuming and labor-intensive, requiring manual entry or even physical inspection of documents—and can not verify multiple ID types simultaneously. All this makes it an expensive process for banks to undertake, as a report by IBM estimates the average cost of verifying identity at $15-$20.
Fortunately, technological advancements are helping to streamline the verification process by bringing biometrics into the equation. Biometric verification can take place on any device with a camera and Internet connection—such as a smartphone or laptop—and is not only less expensive than manual verification but also more accurate due to its reliance on physical characteristics rather than easily replicated documents.
Additionally, they can be used together with existing forms of identification such as passports and driver’s licenses to avoid delays caused by inconsistencies in customer data across multiple ID types (for example, when someone uses different names for different IDs).
Biometric Information Cannot Be Readily Altered, Offering Better Protection Against Fraud.
Your fingerprints, for instance, are unique to you because your body has a unique way of making proteins that makes your prints, unlike anyone else. However, biometrics can be for more than just fingerprints. An iris scan, facial recognition, and even the way you walk are all unique ways to verify your identity through biometrics.
To optimize the precision of its usage, identifying biometric data is combined with other pieces of data. For example, when a person tries to enter a facility without authorization and enters by the security system owing to a phony identity card, facial recognition technology can establish that they do not belong there based on their ID photo.
In addition to being difficult, if not impossible, to replicate, biometric data is often faster than traditional verification (like typing in a PIN). Furthermore, it is extremely easy for users since they do not have anything new they need to remember or carry around with them (like keys).
To Protect Your Business, You Need a Secure Electronic ID Verification System
In an age of online banking, money transfers, and cryptocurrency transactions, it is more important than ever for financial institutions to ensure that the people using their services are authentic. The banking industry is a prime target for fraudsters looking to steal funds from unsuspecting account holders. Understanding how electronic identity verification may secure your firm should be a top priority for anybody working in the financial sector.
A secure electronic ID verification system can help financial companies maintain customer confidence while preventing potential losses due to fraud. The function of this service is to confirm that the person opening an account or initiating a transaction is who they claim to be. It helps prevent criminals and hackers from stealing someone else’s identity to gain access to their funds or open fraudulent bank accounts themselves.
Electronic ID verification systems use personal details like names, dates of birth, and government-issued identification documents such as social security cards or driver’s licenses to match identities with existing records already stored within the database. Electronic ID verification ensures customer trust and safety by protecting against identity theft and other types of fraud associated with online banking.
