How Online ID Verification Supports Age-restricted Sellers?

The online stores selling age-restricted products like gaming services, medicine or drugs are in severe need of performing age verification. According to a recent study, online spendings of children are £64 million yearly which they do without the knowledge of their parents. 4 out of 5 children are making transaction through their parents’ bank cards, PayPal accounts and online accounts.
A recent study shows that two-thirds of teenagers are financially active online. They spend a lot on buying age-restricted stuff which includes gaming services, cigarettes, alcohol, cannabis, weapons, and solvents. Nearly a quarter of teenagers buy movies and video games which are intended for the higher age group. CPP, research for credit card companies shows that 1 out of 7 purchases are done by the children aged between 7 and 16.
The part of human brain that correspond to personal pleasure grows faster than the parts contributing in risk analysis and decision making. Therefore, their activities should be monitored actively and continuously to avoid several issues that might cost more than the bills teenagers pay online. Age verification is a lawful requirement in many countries to allow online activities. Online stores should have a proper age check which makes sure that on the other side, product is not sent to underage customer.

Here are a few industries that need protection against under-age identity fraud

Gaming Industry

Every industry has some set guidelines that have to be followed in order to avoid regulatory scrutiny from their concerned regulators and there are quite a few regulators governing the online gambling industry. Any online gaming and gambling platform that fails to comply with these regulations have to face huge revenue loss, strict disciplinary actions, and hefty fines.
According to a study by the Gambling Commission, 450,000 children are involved in the online gambling process. These children are the ones aged between 11 and 16 and most of them take drugs. For online gambling operations, strict rules are defined. The children under 18 cannot be part of the gambling community. The legal age is 18, in some areas it is 19 or 21. The online buying by less than the judiciary defined age is not allowed and is considered illegal.
Online Gambling is not the only digital menace haunting minors on cyberspace but there are multiple age-restricted products that teenagers are buying online such as

Vapes and e-Cigarettes

According to the 2018 report of the US Food and Drug Administration (FDA) regulations, 78% of high school students are using e-cigarettes. In just one year (2017-2018), e-Cigarettes usage has increased from 11.7% to 20.8%. A proposal is given by the FDA in which access to nicotine products is restricted to teenagers (under 18).
UNC research shows that online vapes and e-cigarettes are easily available at very cheap prices available in multiple flavors delivered on demand. There is no strict verification process available online and vendors are delivering tobacco openly. Now, due to strict local regulatory rules, online vapes and cigarettes have been baned to the under-age community and the judiciary has made age-verification mandatory in the regulatory.

Alcohol

The study of new data from Slice Intelligence shows that alcohol delivery has grown 32.7% in 2017 and it is increasing by the average rate of 3% every month. Online orders through mobile apps have increased to 20% by teenagers. This increase in underage drinkers shows a great risk which online marketplace pays in the form of heavy fines.
All the online stores should make their system free from under-age buyers. This will not only leave a negative emphasis on the health of teenagers but also the reputation of the company will be damaged.

Cannabis and Medical Marijuana

The mainstream of legal deliverance of cannabis globally has impacted everything. The cannabis industry is one of the fast-growing industry today. According to BDS and Arcview Market Research, the global spending of cannabis by consumers will increase 3 times ($32B) by 2022.
Medical Marijuana is supplied legally in the US. Teenagers are taking advantage of it and online stores are delivering their consumers without any proper age verification.
Many companies take service from the third-party delivery system who delivers the order to their customer. As they need to quickly deliver a large number of orders, the verification at a delivery time can be somehow dodged and it would be hefty for the third party delivery system to send the parcel back to the company with additional overhead. Also in many cases, the customer leaves a note by the door; ‘not at home’. So there is no way for the delivery person to identify and verify the identity of a person.

Online ID Verification is the Solution

Online ID verification helps in ensuring compliance especially for the companies selling age-restricted products online. For the verification purpose, customer’s personal information should be obtained and matched against an independent database. This data could include name, date of birth, geolocation, email, contact number and other essential information based on the company’s requirement. The information is matched accordingly to verify the identity and is further processed with the transaction. The onboarding process should be quick to ensure good user experience, but age should be verified through the instant age verification to reduce the risks of online fraud by teenagers.

What other methods can help verify the age of the customer to allow product delivery?

In this new era of Artificial Intelligence (AI)-based technological advancements, age verification can be done through facial recognition, image verification (with liveness detection), identity card verification and biometric. The person who wants to buy something will have to first verify his age in the onboard process. AI techniques will match the identity (through anyway) of the customer with the stored database and will give the status of accepted or rejected. In this way, it would be hard for the under-age community to buy restricted products online without any proper consent.

Identity Theft is one of the major concerns of customers… How to deal with it?

For any online marketplace, it is mandatory to run the system under certain compliances proposed by the government. In that regulatory compliance, online stores make sure that the customer identity is used for the legal purpose and will not be sold to any third party. Any flexibility regarding privacy affairs is unacceptable by the law and will result in heavy fines and strict lawsuits against the company.

Conclusion

The online marketplace that sells age-restricted products should ensure that through their system, under-age children are not making any transaction. For this, there should be age verification of the customers onboard which can be achieved through AI-based techniques. Age verification helps the seller to allow purchases only for adults and reduce the chances of usage of age-restricted products by teenagers.