At a simple level, identity verification is the process of checking that a person is really who they say they are, to prevent imposters from committing fraud. This process can be as quick and simple as handing over a passport before boarding a plane or showing a driver’s license when buying an age-restricted product like a bottle of wine.
In many cases, government-issued identity documents are used to provide proof of name, age or address, and are verified by comparing a person’s likeness to an official photograph. In other cases, consumers may be required to verify their identity by using a secret password, such as a PIN code when paying with a debit or credit card.
However, as identity fraud becomes more sophisticated and a growing number of transactions take place online, digital identity verification is rapidly evolving to keep consumers and businesses safe. Many organizations now use digital identity verification services to examine a broader range of data. This can help to reduce the risk and cost of fraud, as well as ensure compliance with anti-money laundering regulation when processing financial transactions online or handling personal data.
Digital identity verification solutions process data from a range of different sources to check and verify an individual’s identity. As well as ID documents, this can include contextual data, such as phone numbers and IP addresses, or third-party data, such as voter registration information. By consulting multiple data sets, organizations can significantly reduce the risk of identity fraud.
There are several important moments when organizations may need to verify someone’s identity such as customer onboarding. Some of the most common include when consumers are opening an account, making a high-value purchase, or accessing age-restricted services like online gambling.
In many of these moments, consumers may be asked to provide proof of identity. This could be by typing in a unique code sent to a mobile device for verification or e-mail address, using a card reader, or uploading a photo of an official ID document along with a photo or video of themselves to show the likeness.
Yet, while identity checks can help to reduce fraud and build trust, consumers expect to be able to create and use accounts easily with minimal friction. organizations must strike a balance between enhancing the customer experience and protecting profits, but that can be easier said than done.
As more transactions take place online, fraudsters are increasingly using false or stolen identities to commit crimes or launder money. Some of the most common threats that organizations are facing today include payment card fraud, phishing attacks and electronic transfer fraud. While a growing number of fraudsters are using account takeovers to impersonate real customers for financial gain.
This, in turn, is damaging trust and impacting growth, as consumers feel less safe transacting online. A third of consumers believe their personal information is available for sale, while two in five people are concerned their personal information could be exposed when transacting online.
In the fight against fraud, digital identity verification is an important part of organizations’ arsenal, providing the information needed to quickly spot and stop fraudsters at scale, while simultaneously delivering the seamless and secure experience that customers expect when transacting online.
Fraudsters are deploying a wider range of increasingly advanced tactics, leaving organizations feeling unprepared and exposed. In a recent study, we found that many organizations are deeply concerned by their ability to stop fast-growing threats like IP theft and piracy, social engineering, and synthetic identity fraud - a method that combines real and fake customer information to build a new identity.
To ensure that customers and transactions are always protected, organizations must evolve their approach. Access to dependable, real-time data can help organizations stay alert to the risks posed by false or stolen identities, first or third-party fraud, application fraud and money laundering.
Access to a trusted customer onboarding solution that enables organizations to build automated and unique customer onboarding journeys is crucial to ensuring identity theft and fraud are halted in their tracks. While denying or flagging suspicious identities, a comprehensive solution should provide a frictionless digital onboarding experience for genuine customers.
GBG GO's no-code, secure customer onboarding solution fast-tracks an organization's genuine customers while taking high-risk customers on a more secure onboarding journey. Want to learn more about how GBG GO can help your team prevent identity fraud and get to market faster? Get a demo here.
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