The introduction of technical innovations has generated a plethora of opportunities for the corporate and financial sector, has surely created multiple industries and services such as online money lending or funding platforms, virtual currencies, online banking, and much more.
However, the revolutions have also assisted professional scammers and fraudsters in coming up with new and efficient illegitimate schemes. In the US, a total of $712.4 billion was lost to Id fraud and theft in 2020. In the current business landscape, the cases of financial fraud and ID thefts are exploding which indicates being equipped with AI-powered id verification solutions that guarantee authentic customer onboarding for risk minimization.
Different ID verification solutions make customer identification swift, the purpose is to confirm credentials thoroughly without taking long so the customers don’t get bothered and can have a great user experience.
Types of ID Verification for Business and Financial Entities
- KYC Services
- KYB Authentication
- Biometric Verification
- Video KYC
- OCR Services
- AML Screening
Know Your Customer (KYC)
The digital Id verification in compliance with KYC regulations involves ensuring the identity of an individual by demanding a set of particular records such as photo-based Id, driving license, utility bills, tax/rental agreement, bank statement, and so on to make sure that the person is really who he claims to be.
- The individual positions the documents in front of his device’s camera and the AI-powered optical scanner verifies every single character of documentation, overwriting, or forgery is instantly recognized and rejected.
- In online identity verification, customers also upload a live selfie which is identified along with the entire data by matching it against the information incorporated in national data registration authorities.
- The final results are generated in seconds, saving both firm and individual from inconvenience.
- The solutions also offer mobile 2FA for fraud prevention and avoid account takeover by an unauthorized party.
Id Verification in KYB (Know Your Business)
For banks, insurance companies, or brokerage firms, identity verification is imperative as the degree of risk of financial fraud here is way more than in any business or platform. The KYB authentication is slightly different from KYC. The preliminary data collection process is the same. Unlike KYC, the process focuses on a number of things.
The Identity verification solution from business firms require:
- Official registration number of the company
- The authentic license of conducting business in the particular field
- ID proofs of UBO’s of the firm
- For digital identity verification, bank statements of the firm, business statements, filings, ledgers, reports, and others are validated as well
The credibility of the documents is verified by OCR technology. The machine learning algorithms of the AI model recognizes any skepticism in no time.
The process verifies the legality of the dealings and trade of the organization by conducting extensive background checks and any past record of illegitimacy is recognized in a second through an id verification solution and flags the profile.
AML Screening
With access to top-secret databases, PEP’s lists, watchlists, the Id verification solutions run a background scan on the individual against global records to make sure that the concerned person or firm isn’t part of any illegal activity and not under surveillance by FATF or any agency. Any suspicious lead gets detected in a second. Based on the Id verification, each client profile gets a risk rating which helps in managing business activities and decisions instantly.
Video KYC Verification
Post initial ID verification, analysis of documents, and proof of address of the individual or firm, the bank or business firm arranges a video call for absolute confirmation and to cross-check the initially provided information by the customer. In Id verification, the integration of AI-powered facial technology and KYC agent validates the authenticity by observing the facial features, traits like age, race, and language.
The background of the customer’s position and his body language can also conclude effective information for making decisions onboarding.
Face-to-Face interaction between KYC agent and customer eliminates the remaining risk of financial fraud and ensure risk-free customer onboarding
Facial Biometric Recognition
The facial biometric Id verification provides an additional protection layer as, like passwords or PINs, it can’t be stolen.
For biometric identification, a 3D depth analysis is performed to ensure that there are no such uses of screenshots or older images and that the uploaded one is genuine.
AI Mapping Techniques
The faceprints in Id verification recognize characteristics like age, race, and gender, to ensure that information on ID documents corresponds with certain facial features. This additional layer of protection in biometric solutions makes fraud prevention seamless.
Liveness Detection
The biometric technology confirms the liveliness of the user by capturing minor expressions such as blinking or smiling.
The micro-expression analysis and AI mapping techniques in Id verification prevents 3D mask attacks and spoofing, to assess the authenticity of facial verification in no time. Spoof detection streamlines the KYC/AML procedures and reduces risk to zero for entities.
OCR (Optical character Recognition) for Enterprises
The OCR technology is massively used in different industries for Id verification. It extracts desired information from Id documents, each character is scanned and converted into an ASCII code. The technology captures all the information, received in unstructured format and transitions it in a systematic composition according to the platform in no time making data processing for ID verification seamless, essential in due diligence banking, and saves processing by huge difference, Rossum’s Software stated that AI-powered OCR technology has reduced their processing cost up to 80%.
Conclusion
In the age of connected commerce, firms, and financial entities, for ensuring risk-free customer onboarding and to provide clients a better customer experience, an online Id verification solution is a compulsion. It can validate the ID of a soul in seconds through various AI-powered mediums with great accuracy. For maintaining compliance with KYC/AML legislation and protecting the assets and data of both customers and the firm, Id verification checks must be performed. Digital identity verification is the prime weapon against scammers.
