In an era where technologies have been introduced, conventional ways have lost the spotlight. The planet has witnessed progress from manual jobs to automated operations.
Digital identification solutions have given more precise verification results. This solves the problem of one-on-one meetings by performing the verification remotely.
Now each manual job has a machine replacement to it. For example, computer typing has succeeded handwriting, and calculators have overpowered manual calculations. Common users have also altered their lifestyles consequently since technology is more of a need. They use smartphones for discovering paths and neighborhoods, reading new methods, and acquiring solutions to their inquiries.
Social media has become a custom at this moment. Users post their everyday actions on social media like starting a job, attending a function, or expressing their feelings. From the past decade, social media has defeated other activities like sports (indoor and outdoor) and physical meetings. Now people prefer audio or video calling instead of going to meet friends personally.
The shift towards digital platforms has given infinite benefits, but the disadvantages should not be neglected. Due to poor handling and manual ID authentication, online Know Your Business are at potential risk of scams and frauds.
Digital ID Authentication: Securing Online Platforms With Remote Verification
ID authentication is a method in which it is checked whether the information provided by the user is valid or not. Financial service providers use this method to verify their customers’ identities and their data. The reason is they were the foremost victim of identity fraud and money laundering because they had cash directly. They usually have all the ideal circumstances that a financial criminal wants, i.e., funds circulation, numerous customers, and international coverage.
The motivation behind all crimes is getting financial benefits which can be easily availed through financial crimes.
Why Financial Institutions are at Risk of Identity Crimes
Criminals attack financial transactions and customer accounts through identity theft. They onboard using fake or synthetic data, the information is either stolen or a mixture of authentic users’ details. Then they continue with their illegal exercises there. They can transfer funds from the victims’ bank accounts or acquire their financial information (ATM or credit card number and PIN)
Money Laundering: Using Fake Accounts to Circulate Ill-gotten Money
The customer accounts can also be utilized to clean dirty money, which is adverse monetary misconduct. The money is scattered in the financial system employing multiple accounts so that the connection with the sources can be departed. More than one account is used to integrate illegitimate funds, verifying businesses can be penalized for not restraining the criminal funds’ involvement from their channels. International regulators issue heavy fines on banks for non-compliance with KYC/AML/CFT regulations.
Identity Theft – Stealing and Acquiring Legitimate User Information
As discussed before, identity theft is a cybercrime where a bogus profile is created over the internet using some other person’s information. This has the identical name, image, and other data as the genuine user. Just like, one creates a social media profile using false details. The information is a fusion of authentic and fraudulent data. He can scam or blackmail other users in this way. According to a report of III, identity theft is constantly surging, the percentage doubling in just three years with 13% in 2017 and 29% in 2020.
Digital ID authentication verifies the identity of a person by examining his documents. It is performed by a method known as (KYC) (Know Your Customer). ID documents authorized by the government are believed to have authentic information. The user just has to upload the picture of the ID. It experiences document verification where its legitimacy (government approval) is verified, and data is obtained. The information is certified by the KYC software that can spot all the irregularities in the document. Biometric verification is conducted on live clicked selfies and photo IDs. In the final step, the address is checked, and age is verified (whether it falls in the range or not).
Summing it Up
Digital ID authentication is a much more budget-effective solution than other methods while reducing the time for verifying information. The software is backed by AI with zero human effort, having minimum possibilities of flaws. Businesses should adopt this ID card authentication solution to build a strong shield against financial crimes.
