Identity scams are rapidly increasing on online business platforms. With the use of advanced technology, criminals can gain access to consumers’ sensitive data easily. Criminals make use of this information to perform online transactions while impersonating as verified consumers. Identity theft is the primary reason for multiple frauds such as credit card or account takeover fraud. It is a major risk faced by both financial and non-financial organizations that lack efficient security measures and identity verification services.
What is an ID Verification Service?
Identity verification is a process through which businesses ensure that the authentic consumer opens an account, applies for a loan, or makes any payment. It is an important security protocol to detect and prevent identity fraud. It helps organizations comply with KYC and AML regulations to identify suspicious customers or corporations.
How is ID Verification Performed?
The ID verification mechanism works by comparing the government-issued ID documents against the information provided by the end-user. ID verification is performed in various ways. Each method uses a different authentication procedure.
Following are the types of ID verification:
Face verification service uses artificial intelligence and 3D depth analysis for accurate identification and fraud prevention. The end-users are required to capture their live selfie along with the image of their ID document. The facial verification system checks whether the live selfie matches the information on the ID document or not.
Address verification process verifies the address of the end-user. It requires a picture of the ID document and address document. The information from the address and an ID document is extracted. The system determines if there’s a match between the information present on both of these documents.
2 Factor Verification
2-factor verification is an identity checker technique by the means of automated or personalized code. The code is sent through a text message. The user usually enters that code for both login and verification measures. The system then matches that code against its code records for verification.
Document verification is used to check the authenticity of the ID documents (passports, ID cards, driving license). This process usually requires the image of the ID document. Optical character recognition technology collects the information present on the ID document. This information is then compared against the government authorized data sources.
How ID Verification Improves Security?
Recent statistics show that e-commerce retail revenues are expected to reach 5.4 trillion US dollars by 2022. Ecommerce platforms face a major threat of imposter and identity scams. Criminals use fraudulent and stolen identities to perform illegal transactions. These transactions are then claimed as a chargeback by the verified customer. It causes a huge loss to the business and destroys its reputation in the market.
Following ways are used to enhance the business security:
Identity verification enables strong defense against imposter and fake identities. It performs comprehensive background checks to determine the eligibility of the end-user. It verifies the end-user in real-time to detect identity scams at an earlier stage. While reducing the chargebacks and increasing the profits of the business.
Protects Market Reputation
Online businesses that lack sufficient security protocols are vulnerable to threats of data infringement and data breaches. Creating a negative brand reputation among the online market community. Similarly, if any business incurs multiple chargebacks it will lose its trust among customers. Identity verification is a robust solution for businesses to protect the sensitive information of their end-user. To maintain a credible reputation among the customers and markets.
Online identity and credit card scams caused an increase in chargebacks and penalties for online businesses. Forcing the company to raise their prices and make up their loss. With seamless identity verification service businesses can prevent any kind of fraud in real-time.
Protection of Customers
The important benefit that identity verification service provides is the protection of customers from any fraudulent or suspicious transaction. ID verification detects an illegitimate user and restricts him before he can carry out any suspicious activity.
KYC and AML Compliance
Financial authorities have introduced firm KYC/AML regulations for businesses to prevent financial and identity scams. Organizations that lack to follow appropriate KYC and AML verification protocols are imposed with high penalties and penalties. With AML checks in place, businesses can access and monitor the money laundering activities of other businesses. While KYC measures carry out screening of KYC documents such as ID cards or passports to verify legitimate end-users. Identity verification is a multipurpose solution for businesses to perform KYC/AML checks and comply with these regulations.