With the recent shift of the banking industry from manual to digital operations, the inclusion of ID verification technology into the banking procedures involving customer onboarding and securing high-risk transactions has become a trend that’s catching on quickly. There are multiple reasons why banks around the globe are adopting the ID verification technology. It not only helps them secure their processing and interests but safeguard clients’ interests as well.
As the frauds and scams get intelligent and sophisticated, the banks need to update their technology as well. The route to that is bringing innovation and adaptation into their methods of fraud prevention. This is absolutely essential considering the innovative and new ways of fraud that they encounter every other day. The best way the banks can do this is by revolutionizing the KYC and AML screening procedures that are used to verify new customers or high-risk transactions.
Bringing innovation into their identity verification procedures is usually adopted by banks in the form of inclusion of artificial intelligence and machine learning techniques. These techniques are completely automated and highly accurate, saving time and resources both. Quick and accurate verifications lead to high client-consumer trust, bringing in substantial business and traffic. This gives banks a competitive edge over other conventional banks in the market who choose to go with traditional ways of performing KYC, manual and without the use of AI and ML.
Rising Fraud Rates
As the fraud rates skyrocket, especially cybercrime and hack-attacks on bank’s servers, it is time to charge at these attackers head-on. Digital ID verification is the way to go about it. Integrating the services of an IDV provider will help the banks to detect any fake or doctored documented presented at the time of sign up or transaction processing. The criminals have gotten smarter, forging documents with such detail and accuracy that there is no way a human eye could ever spot a difference or even that there may be something wrong with it. To counter this, precise computer vision technology is required, which looks at security markers, and minute details on the document, which are undetectable when looked at by humans.
RegTech and Due Diligence
Banks can benefit from ID verification in the form of risk mitigation, where they can quantify financial risk posed by new customers, unusual account activity and dubious transactions. In addition, due diligence measures are also upheld through robust customer vetting with an option for constant monitoring and thorough background checks, in IDV providers like Shufti Pro. Furthermore, compliance with regulations safeguards banks and their processes or operations against regulatory scrutiny, reducing penalties from banking regulators.
Cost and Time Efficient
A Centralized and coherent ID verification system can help the banks lower redundancies and manual efforts, yielding better results. The complete process is carried out in a matter of seconds. This practice reduces the chances of false positives and serves an accuracy rate of 85% and above for most service providers. What is more is the Artificial Intelligence that operates at the heart of major IDV providers, making the entire process transparent and lightning fast.
You can get more info about the ID verification trend in the banking industry to truly realize the potential of KYC and AML screening in the market. Sooner or later, all banks around the globe will have to adapt to the ID verification process in order to survive and soar.