The Growing Need of Digital Identity Verification Post COVID-19

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The coronavirus outbreak has caused a significant shift in the way we conduct our daily lives. Our relationship with technology, as well as the way we electronically access financial services, has undergone a transformation. As we prepare to continue our lives in the post-corona world, we are becoming highly reliant on digital platforms and technology to bridge the gap between manual chores and what the future holds for automation. 

This is particularly visible in the financial industry, as individuals and companies must adjust to the process of opening accounts, submitting loan application forms, and conducting transactions via digital and mobile payment systems. Online banking necessitates a high level of confidence between the bank and the consumer. Banks must verify their clients in order to adhere to the requirements of customer identity verification.

They must follow adequate Know Your Client (KYC) procedures in accordance with international and national legislation, as well as guarantee that the client is not a bot or a scammer. It is consequently critical to be able to verify an individual’s identification remotely and in real-time via electronic identity verification. We will look at the importance of identity verification and the benefits of these online solutions in this article.

What is Identity Verification?

The online verification of identity helps to ensure organizations that their consumers are legitimate and really are who they say they are. AI-based identity document verification systems can analyze thousands of paper types to ensure their authenticity. ID checks have been in existence for a long time, but they are still carried out manually. The manual procedure is insecure and delays the entire customer onboarding process, resulting in a negative user experience. 

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The manual method is less precise, and crooks might use their skill to outsmart the system. The document authentication procedure is quick and secure when done digitally. It protects data while identifying the crook in the act. The entire procedure can be completed in seconds, increasing consumer turnover. Let’s take a closer look at which sectors are in desperate need of identity verification online.

Which Industries Benefit From These Solutions?

Banking Industry 

The finance sector includes the banking sector, insurance firms, cryptocurrency exchanges, and other related institutions. They are the most vulnerable to financial fraud since it includes a mammoth amount of monetary transactions. According to a UNODC estimate, up to 5% of global GDP is laundered each year. This means, between EUR 715 billion and EUR 1.87 trillion is laundered. 

The figures demonstrate how much the financial sector needs to secure system integrity and prevent financial crime. In addition, the banking industry loses money due to the prolonged client onboarding process. Comprehensive identity verification and document authentication solutions are much needed for this industry to detect fraudsters while quickly onboarding consumers.

Online Gaming Industry 

People can now connect with each other easily thanks to the fast-paced internet. The days of simplistic computer games are long gone. There are now massive e-gaming sites that offer online betting and other services. People can now even make money by playing online games, which is what the crooks are exploiting. Laundering money has become a prevalent practice in the gambling business so online gaming verification with KYC is mandatory. Gaming platforms can be controlled and the trail of unlawful activity may be tracked back to the crime by including online ID document verification.

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Beverages Industry 

The alcohol sector is required to adhere to certain age-gate restrictions. They are not permitted to sell alcoholic beverages to anybody under the age of 21 without first confirming that they are of the legal drinking age. In terms of age limitations, each nation has its own defined set of rules. Teens, on the other hand, attempt to circumvent age checks and get age-restricted products by using fake IDs. The digital identity verification solution can accurately identify not just the cardholder’s age but also his or her identity, ensuring that no laws are broken.

Money laundering is a threat to insurance businesses that has far-reaching consequences. Most online identity verification services use the very same authentication technique outlined above, to keep businesses secure from these attacks. Thousands of worldwide watch-lists are examined continuously throughout the AML compliance method.

The Relation Between CDD and AML

Customer (CDD) in banks and other financial institutions is a crucial part of comprehensive anti-money laundering compliance. This compliance program necessitates the banking industry to follow regulatory measures or face operative penalties. Over the years, many regulatory agencies have imposed harsh limitations in order to limit money laundering and financial transactions used to support terrorism and other heinous crimes.

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