Digital services including digital banking, telemedicine, and online marketplaces have grown quickly as a result of the digital landscape’s rapid acceleration. The significance of accurately identifying the person on the other end of a transaction has substantially expanded. As more firms, particularly those in banking and financial services, serve more clients online. Companies that do not modernise their identity proofing procedures in order to be digitally relevant may lose consumers, and become fraud targets. They suffer the repercussions of non-compliance with regulations as digital interaction models proliferate. Document identification and verification have vital importance.
Inadequate identity verification makes it easier for scammers to pose as trustworthy customers. While secretly using stolen personally identifiable information (PII) and synthetic identity fraud. These crimes get committed for financial gain and other illegal purposes. Such include money laundering, terrorist financing, drug and human trafficking, and human trafficking.
Document Identification & Verification:
Using document verification and identification is one of the key methods for confirming a customer’s digital identity. Customers require to submit identification documents, such as a driver’s licence or passport. Documents issued by the government contains PII and a picture of their face. As well as a selfie image when requested, as part of the digital onboarding process.
The ability to establish trust by confirming both the legitimacy of the document and the association of the person presenting the government-issued documentation as their own with the presented identity makes this information essential for any company that offers goods or services digitally, especially financial institutions.
Five Trends That Are Affecting the Document Market
Following are five trends that are impacting the market for document identification and verification. FIs should be aware of this as they prepare for digitization as the usage of digital continues to rise.
- Moving to Digital and Mobile
- Digitization is the result of increased cost pressures
- a thriving competitive market
- evolving fraud
- observing the data protection laws
Moving to Digital and Mobile:
With customers accessing goods and services online in the years before the COVID-19 pandemic, there was already a drive toward a more digital-first environment. However, there is little doubt that the global pandemic accompanying lockdown limitations dramatically increased online use—particularly mobile use.
Digital and mobile services are predicted to become standard for account opening and onboarding for financial services in a post-pandemic world. As well as gaining popularity in a number of other sectors, such as healthcare, gaming, retail, and government, to name a few. Learn about Wpit18 and 6streams
Digitization is the result of increased cost pressures:
Many people were forced to stay at home throughout the past two years. Since they couldn’t travel to physical venues like bank branches. As a result, businesses that anticipated a loss of revenue increased expenses and started to adjust to a new, more digitally centred world. Businesses across several industries have been able to meet consumer needs. They need to provide a wider choice of services by integrating digitalization into their control system (and prices). Learn more about apk
More specifically, leveraging digital identity proofing tools like document ID&V has made processes more efficient and automated while ensuring that businesses abide by the ever-expanding AML rules.
A thriving competitive market:
More startups are now able to enter their respective industries thanks to digitization and developing technologies, and established banks and financial institutions now face fierce competition from fintech like neobanks and challenger banks. In order to gain a competitive edge over more established companies. These virtual providers offer a wide range of financial services and make use of cutting-edge technology to speed up customer onboarding and identity proofing. Traditional company models must change if they want to stay relevant.
Evolving fraud:
Financial institutions today must have the appropriate safeguards against fraudsters, such as stringent KYC procedures, document ID&V, and secure logins. Technology advances along with fraudsters’ methods of operation. Because data breaches and data leaks are so frequent, fraudsters can gather personally identifiable information (PII) and identity documentation on the dark web. They use it in phoney account creation and account takeover attempts.
For organisations that wish to avoid fraudulent clients and function digitally. They need identity proofing technology to verify the person for a transaction is more crucial than ever.
Observing the data protection laws
As regulators throughout the world grow more worried about the security and privacy of people’s data. The focus on privacy and data protection has increased and probably will continue to do so. Regulators all across the world are establishing and implementing stronger privacy regulations for companies, using the EU’s GDPR and California’s CCPA as models. Companies that handle people’s data digitally must keep up with changing data privacy legislation in each jurisdiction. They operate to ensure they can comply with data privacy rules.
