Industries that Need Digital Identity Verification and Why?
With continuous improvements in technology, different industries of the world are streamlining their processes, decreasing the workload on employees that increases their productivity, and lastly, they can build profitable relationships with the customers. However, there is always a dark side of everything in use and technology has one too. The technology was introduced to make lives easier, but fraudsters are using it for their illegal gains. Money laundering, terrorist financing, trafficking, identity theft, synthetic identity fraud, account takeover fraud, and data breaches have significantly increased. None of the industries is safe from fraudsters. Nevertheless, there is always a way out and organisations have a great solution for combating criminal activities.
The virtual world we live in now has digitised everything and robust digital identity verification solutions are helping industries to combat crimes and prevent fraudsters from messing with the customers’ information.
Eager to know more about digital identity verification? Keep reading to find out what it is, the industries that need it, and how it can benefit these sectors.
What is Digital Identity Verification?
Digital identity verification is a process of verifying customers, employees, and other stakeholders of the company to onboard legitimate people only. It ensures the authenticity of an individual through various biometric authentication checks and verification of government-issued identity documents. It is meant to verify every entity that will become a part of your organisation.
Identity verification has been assisting businesses in verifying all the individuals that get in touch with the company. However, manual checks do not ensure robustness of the process. Fraudsters can easily dodge the process with false information and fake documents. The digital identity checks verify entities using Artificial Intelligence algorithms so that fake documents are not used for completing the process.
Industries that Need Digital Identity Verification
None of the sectors is secure these days due to the sophisticated methods of fraudsters for their malicious activities. Every industry across the globe needs digital identity verification checks, but here are some of the sectors that need it the most. These areas are the primary targets of all criminal activities; therefore, their security is crucial.
Online Gaming
The internet has made it easier to communicate and collaborate. Consideringthe significant increase in the market revenue for e-gaming, the industry is prone to illegal activities. However, criminal activities have increased too. Online gaming is the latest trend for everyone including fraudsters. There are more than one billion online gamers across the world, and more than half of them are at risk. Targeting the young ones for their illicit activities or using the platform for money laundering and terrorist financing is very easy. Online gaming platforms can add digital identity verification to ensure that criminals stay away.
Read more: How to protect your online gaming platform from ID frauds?
Gambling
The gambling sector also needs digital identity verification checks to ensure all the customers or players are legitimate. Money laundering is the fundamental motive of fraudsters entering this sector. It gets easier to place illegally earned money in a place where everyone is rolling money without verification. Employing digital verification measures can help the gambling industry to keep money launderers away from the real players.
Alcohol
Verifying age is essential before making any transactions in the alcohol sector. Otherwise, minors will get free access and health hazards will increase. Underage drinking is banned in all regions of the world. Unfortunately, showing forged identity documents for age verification is very easy and common nowadays. Getting digital age verification checks can help all the companies operating in this sector to prevent minors from consuming adult products.
Finance
Banks, crowdfunding, insurance companies, and virtual payment platforms are striving hard to make all procedures easier for the customers. However, criminal activities are making it a big problem. Moreover, the rising expectations of customers are a greater challenge. Reports from UNODC and Europol have estimated that two to five per cent of the global GDP is laundered every year that accounts for EUR 715 billion to 1.87 trillion every year.
Digital identity verification solutions can help banks, insurance companies, and other entities in the finance sector to make the onboarding process seamless. Moreover, fraud prevention is the ultimate benefit that all organisations seek.
Travel
Fake travel agencies, forged identities for escaping, and many other activities are making it difficult for the travel sector to comply with the KYC regulations. The cost of travel industry scams will exceed USD 25 billion soon. Face verification and other identity verification measures can help the travel industry in complying with the regulations. Moreover, these robust checks can help them in preventing fraudsters from flying away with all their dirty activities.
Inevitable Reasons Why Industries Need Identity Verification
Digital identity verification is the ideal way of getting rid of fraudsters. Verifying everyone that interacts with your business is essential in the modern world. Forged identities have become very common and you never know when a fraudster disguised as a potential consumer gets in touch and causes some serious troubles for you. Here are the top reasons that make digital identity verification inevitable for enterprises.
Better Compliance with KYC/AML Regulations
The FATF has enforced regulations on almost every industry to prevent fraudsters from causing any issues and ensure that all businesses are running secure operations. Otherwise, money laundering and terrorist financing will continue to increase. Complying with the Know Your Customer (KYC) and Anti-money Laundering (AML) laws from the regulatory authorities is not easy. However, employing digital identity verification solutions is one way that can help all the sectors in achieving their goals. Stringent KYC/AML compliance will get more straightforward than one could have expected it to be.
Read more about FATF guidance: RegTech – FATF Guidance for Digital Identity Verification
Protection of Minors
Minor protection is crucial and simple age verification through date of birth cannot prevent them from accessing adult websites. Alcohol, gaming, gambling, and crypto exchanges are just a few sectors to name. Social media platforms are another big threat to minors. All these sectors can add robust identity verification mechanisms so that the young ones cannot use false numbers to dodge the age verification checks.
Read more about age verification: The Need for Online Age Verification to Protect Minors
Fraud Prevention
The rapid increase in criminal activities is making business operations a problem. Fraudsters use forged identities and fake documents to surpass verification checks. Unfortunately, manual methods of verification cannot ensure security. On the contrary, digital identity verification checks not only make it easier to filter fraudsters during the onboarding process, but it also helps in preventing fraud. These verification measures require less than a minute to perform different checks. Moreover, the AI-powered solutions like consent verification, face verification, document verification, and address verification can help in onboarding legitimate customers rather than criminals.
Recommended: Face Verification – One Solution for Several Identity Frauds
The Final Words
Criminal activities have increased over time and industries like alcohol, gaming, gambling, cryptocurrency, finance, and telecommunication are the first targets of fraudsters. Companies in these sectors are at risk of illegal activities like identity theft, account takeover, synthetic identity fraud, money laundering, and terrorist financing. There is a dire need for a solution that can help all these sectors in preventing fraudsters from making any issues. Securing businesses for the legitimate stakeholders is essential and digital identity verification checks can help.
With the help of face verification, biometric authentication, document verification, and similar checks, these industries across the globe can protect the businesses and stay safe from hefty fines. Furthermore, these checks help in complying with the stringent KYC/AML laws from the FATF, FinCEN, and other regulatory bodies.
Learn more about digital identity verification from our experts.
