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ID verification prevents 8 Security Issues of businesses

Ashley Williams
June 20, 2019
6 minutes read
1368

The biggest concern for businesses, in terms of safety, nowadays is online or cybersecurity. As data breaches across different companies become increasingly common, online security becomes a major concern for enterprises storing large amounts of user data. The estimated cost of a single data breach will reach $150 million by 2020, costing $2.1 trillion annually. In January 2019 alone, a total of 1.76 billion identity records have been compromised due to such data breaches. In the light of such gaping security concerns, companies must ensure the safety of their user data. Robust security measures including data encryption, two-factor authentication and identity theft protection need to be practised by businesses.

As the internet proliferates the fabric of the world, consumers and businesses become more and more dependent upon it. Securing data online is becoming increasingly tricky, particularly for companies that engage customers online. Progression in technology is giving way to advanced systems. Cybercriminals are also becoming more sophisticated in their methods to compromise customer data. In order to keep up with such threats businesses must also embrace modern technology tools to keep out fraudsters. Some of the daunting security concerns faced by businesses today include;

1. Increased Data Breaches

The year 2019 has experienced a significant number of data breaches across major companies including Toyota, Facebook and Equifax. Even government agencies are victims of data breaches. The U.S. Federal Emergency Management Agency data for 2.5 million disaster survivors were compromised earlier this year.

There are a number of reasons for the increasing number of data breaches including:

Lack of online security.
Increasing use of cloud storage in businesses. While cloud computing may seem a much secure method for securing one’s data, cloud providers must be chosen with care.
Backup of essential data is not encrypted and stored on hard to breach servers.

It so happens that while backing up your data offline, other virtual devices are able to gain access to your system and thereby your information. For additional security, companies must encrypt their data to make it harder for hackers to access it.

2. Unsecured APIs

As the trend of Software as a Service (SaaS) is growing, many businesses are relying on third-party solutions for different purposes including customer services, project management and e-mail and chat support. Although such systems have increased the effectiveness of businesses significantly, not all of them have secure user interfaces. Identity Theft Protection Vulnerable APIs can lead to security breaches in online systems. It, therefore, comes down to the providers that a business chooses to improve their processes and systems. Reputable SaaS providers, however, have better security systems and secure APIs.

3. Inside Sources

Companies are most vulnerable in terms of the threat they face from their own employees. Disgruntled or terminated employees can end up leaking valuable user data from their companies. However, inside breaches may not be intentional at all. Employees in training may not be aware of the vulnerabilities in security. Therefore, it extremely important to educate your staff from day one about cybersecurity and measures to observe to ensure the prevention of data breaches and malware attacks.

4. The Rise of the Internet of Things (IoT)

Another rising trend in businesses is that of IoT or the Internet of Things. It relates to any and all electronic systems connected through the internet. Although IoT makes business systems more efficient and productive, it also leaves them more vulnerable to security breaches. With multiple endpoints in IoT systems, consumer data becomes more exposed. To address this issue, organisations must protect their software and customer information. It is imperative for businesses using IoT to use DDoS protection software to safeguard each point in their IoT systems.

5. Implementing Identity Theft Protection for Customer Information

A number of businesses dealing in vast amounts of customer data do not have proper security measures in place to make sure that information is accessible to only authorised personnel. Hospitals are a prime example of this. Any member of the staff, including doctors, nurses, technical and support staff, that has access to the hospital’s system can gain access to patient records. Customer data is one thing that needs to be guarded effectively. Using identity theft protection is an excellent way for businesses to keep user information secured.

6. Unencrypted Data

As the trend for BYODs and mobile devices, the protection of sensitive data is becoming ever challenging. Businesses are dealing with hordes of consumer data exposing it to data breaches. Moreover, with the rise of Big Data, companies are fast realising the value of it to analyse it to detect patterns in customer behaviour. However, dealing with vast amounts of data has its own risks as it exposes the data to breach attacks.

One way to prevent this is to encrypt and authenticate all user data. Data encryption puts a roadblock in front of cybercriminals. Meanwhile, the company can take measures to prevent any significant damage to their system and data.

7. Unauthenticated Users

One of the biggest security issues faced by businesses is identity theft and credit card fraud. Online businesses, in particular, are adversely affected by chargebacks and fines due to payment card and CNP frauds. Online verifications services, however, provide the best identity theft protection for businesses. Authenticating customers before allowing them to purchase goods can prevent fraudsters from using fake or stolen identities or credit cards.

Leveraging AI for Identity Theft Protection

Companies can verify customers by employing digital document verification and facial recognition scans. They allow businesses to authenticate the IDs and credentials provided by a user. It provides the ultimate fraud detection solution for companies looking to secure their user information and a solution for detecting and preventing credit card fraud. Shufti Pro is an identity theft protection service that uses an AI-enabled software to provide verification services for businesses.

8. Unpatched Devices

Hardware including printers, routers, servers etc. also make for easy points of entry for malware attacks. All such devices can be an entryway for cyber attacks if not properly secured. Hence, each of these devices must be secured before using them for the company’s purposes.

Disclaimer: No warranty is herein provided that the information contained in this document is accurate, up-to-date, and/or complete. In no circumstance(s), does such information constitute legal or any other advice. Any person who intends to use, rely, pass-on, or re-publish the information contained herein in any way is solely responsible for the same. We suggest to verify the information and/or obtain expert advice independently if required.

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Entering into the fourth industrial revolution, business processes are shifted to the digital sphere. The concept of “physical presence” to get work done is now blurring. Remote working is trending all across the globe and so is the automation. The work that was once done by humans is now being replaced by machines. In upcoming years we are going to see this notion gaining grounds more than ever.

It is no longer a secret that in this era, banks and other financial institutions are struggling to evolve continuously to enhance their operations and providing their customers with an exceptional experience to strive in a competitive market. The banking industry is facing immense pressure to boost its efficiency and utilize the resources effectively in an optimized way.

The challenge to optimize cost and enhance efficiency while balancing security and customer experience is driving the adoption of Robotic Process Automation (RPA) in the banking industry.

The Power of RPA in banking

RPA in banking is mostly concerned with the use of automated software to build an AI workforce and virtual assistants to maximize efficiency and reducing operational costs. RPA in the banking industry is quickly evolving since it serves as a useful tool to address the increasing business demands and optimize resources with the help of service-through-software models.

In order to successfully embrace this technology, institutions must adopt a strategic and well-researched approach. The potential growth of RPA in banking is expected to be worth $2.9 billion by 2022, as compared to $250 million in 2016. It shows that in upcoming years, machines, systems, and bots will be executing the majority of the tasks, hence, expanding the capacity and providing the workforce an opportunity to focus on higher-value tasks.

Over the past few years, the regulations around financial institutes have become more stringent than ever. Banks and other financial institutes are reported to spend more than $321 billion on their compliance operations and the fines faced due to violations, and nearly $270 billion on just compliance operations; in the last decade.

With time, the operating expenses are rising and the stringent regulations impose hefty regulatory fines. This results in slow processes and brand damage leading to poor customer experience. Hiring more people to find new solutions to manage operations while cutting down operational costs is not a reliable answer. The solution has to have the ability to efficiently balance everything; i.e. Robotic process automation.

Integrating RPA enables banks and financial institutions to lesses manual efforts, mitigate risks, offer more reliable compliance and most importantly enhance the overall customer experience. It assists the banking industry in processing operations that are repetitive in nature. Moreover, it increases productivity by engaging customers in real-time.

Though RPA is a comprehensive process that requires structured inputs, robust training, and governance but once implemented successfully, it can take complete control of the processes.
What are the advantages of implementing RPA in the banking industry?

The banking industry is often considered the most crucial industry because of its extensive and hectic business operations and the involvement of regulatory authorities. Implementing RPA helps the banking sector in the following ways

It helps financial institutes to make their process faster, productive and efficient.

It facilitates banks to focus on innovative strategies for a successful business by reducing manual effort and freeing them from their mundane tasks.

RPA helps banks in saving 20% to 50% of their cost and time.

Whether it is about reducing manual errors or achieving accuracy, RPA can automate functions eliminating the errors and completing tasks timely.

It helps financial institutes for adequate risk and compliance reporting.

The implementation of RPA in banking sectors doesn’t require any change in infrastructure because of UI automation capabilities.

The cloud-based RPA solutions reduce integration and hardware costs.

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4 Significant use-cases of RPA in Banking

Robotic process automation is serving financial institutes in multiple ways. Some of the use cases are as following

Customer Onboarding

Customer onboarding is the most critical and time-taking process in financial institutions because multiple documents require manual verification. The identity verification solutions – a domain of RPA – are adopted by multiple institutions to streamline their onboarding processes. These solutions based on AI and machine learning principles make the whole process contactless and friction-free by automating te steps.

AI-powered document verification services integrate optical character recognition (OCR) technology to automatically extract the data from the documents and populating the form. The captured information is then verified against the user-provided information. If the verification is successful, the data is automatically entered into the customer management portal.

Automating customer onboarding through ID verification not only eliminate manual errors but also saves a lot of time and effort put in by the employees and customers. RPA has made customer onboarding a real-time frictionless process done within seconds.

Know your customer (KYC)

After the incident of 9/11, the regulations around financial institutes are continuously evolving and becoming more stringent. Initially introduced as a part of the US Patriot Act 2001, KYC requirements have become obligatory for every institute dealing with money. Banks being the primary source of funds transfer are continuously under the radar of watchdogs.

Since both KYC and AML are purely data-intensive processes, RPA is most suitable for them. The customer identification program (CIP) is one of the fundamentals of the KYC process. With the help of identity and document verification, the real identity of an individual can be verified and ensured. Moreover, RPA helps organizations in anomaly detection, i.e. suspicious transactions in real-time hence, hindering fraudulent transactions.

The implementation of RPA is very effective for financial institutes in terms of saving time and cost as compared to traditional KYC processes that take around weeks and immense manual effort.

Automatic Report Generation

Risk and compliance reporting is a key operation of every financial institution. The banks are obliged to generate compliance reports for fraudulent transactions in the form of suspicious activity reports (SARs). Conventionally, the compliance officers and dedicated teams are responsible for the manual generation of reports. And that makes reporting a repetitive task requiring too much time and effort.

RPA applications based on AI principles can read and process the lengthy compliance documents and automatically extract the required information populating the SAR forms with the help of OCR technology. In fact, for more optimized reporting, the system can be trained with multiple inputs to efficiently process the various parts of the report.

This eventually reduces the operational costs, human efforts and saves the time consumed to successfully perform the task.

Account Opening

Just like customer onboarding, RPA has made the account opening process convenient, quick and accurate. It eliminates the transcription errors between the banking system and new account requests, which automatically improves the data quality of the system. Through RPA integration, multiple banks are using robots for their account opening process. What these robots do is fetch information from the forms and automatically fills data into different host applications.

Such automation results in swift, error-free, and quick data entry process. This results in reduced turnaround time and cost while enhancing the customer experience.