Financial institutions and other establishments interact with numerous customers daily. While many of these customers transact for legitimate business, others are criminals who are trying to get past security to exploit services.
Fraudsters are becoming more persistent in committing fraud, identity theft, and other financial crimes. These illicit activities can cause enterprises to incur severe financial losses. PwC’s Global Economic Crime and Fraud Survey 2020 revealed that about 47% of companies encountered fraud in the last two years, and 13% said that they lost more than $50 million because of it. Moreover, only 56% of these firms had their worst fraud incident investigated.
Besides financial costs, fraud can also damage a business’s reputation, weakening their employees’ morale and resulting in customer distrust. It will take years before enterprises can recover from these effects.
Most establishments still rely on outdated forms of verification, which contribute to a fraudster’s success. Conventional identity proofing methods like Knowledge-Based Authentication (KBA) depend on the concept that only the legitimate identity owner knows the requested data. However, personal information, credit checks, and Social Security Numbers (SSNs) can be obtained by someone else. Furthermore, they do not confirm a person’s claimed identity.
Enterprises must deploy advanced and robust identity verification solutions to counter security threats. Many are already implementing mobile facial biometric identity verification solutions as ideal knowledge-based authentication alternatives. They are easily integrated into most mobile devices and do not require complex hardware and software to operate.
Additionally, companies must also leverage automated identity document authentication to prove that the customer’s government-issued credential is genuine. They must choose the right Identity as a Service provider that fits their security needs.
Authenticating customers’ identity is crucial for businesses to ensure that they are interacting with real persons. To know more about the role of identity verification and identity document authentication in enterprises, Ipsidy provides the following infographic.