Because of COVID-19, remote working increases in a short time. The number of digital platforms has surged during this period. It’s quite charming to the fraudsters who are committing various crimes online.
Identity theft has now become quite common on the internet. Fraudsters try to impersonate as someone else to cheat their way into getting financial gains. They can transfer money from someone’s account or can shop online through fake accounts. This trouble can be solved by executing a robust KYC (Know Your Customer) check.
The customer can be verified through KYC by providing their government-issued identity documents. KYC is more reliable and accurate than manual customer verification. The advanced method used for KYC verification is Video Verification or Video Customer Identification Process.
What, How and Why of Video Verification:
Video verification is verifying customers, whether they are who they claim to be through a video call with an agent. Video verification is done in real-time by a KYC expert, who remotely verifies the identity of a customer through a video call.
Here’s a rundown of the entire process:
- Users get themselves register on an online platform
- Users get on a live video call with a KYC expert
- KYC expert interviews the user for liveness detection
- The user shows his identity documents to the expert
- Documents are verified to check if they are forged or tempered
- The face of the user is matched with the image on identity documents
- Verification results are delivered
The Insurance Information Institute reported that 650,570 identity theft complaints were logged by online users in 2019. This shows that there is a vast risk of digital identity theft in the future. Scammers who try to open their bank accounts perform digital transactions by faking the identity of someone else. The money obtained through this type of scams can be used for money laundering or terror financing.
Benefits of Video Verification:
It can prevent banks and other financial institutions from complaints and charge-backs by the users. Also, it will create a better user experience and due diligence. Customers are more likely to have greater trust in online platforms. The manual interruption will be eradicated with a more reliable and convenient way of verification. Risks attached with businesses will be effectively managed and can help to fight against money laundering, scams and terror financing. Data security on online platforms will be increased. By adopting video verification, a business can save itself from penalties and can save its expenses on cybersecurity.
As the laws are very strict by regulatory authorities on anti-money laundering. A business can easily apply AML/KYC checks through video KYC. However, if an organization doesn’t comply with these regulations, it can be blacklisted by the relevant authorities.
Industries That Need this Solution:
All those industries need video verification that has the threat of digital identity theft and online scams.
FinTech industry, Banks, Insurance Corporations, and other Financial Institutions need this solution because these industries undergo transactions each day. As financial transactions attract more scammers, KYC video verification will be able to tackle them.
E-commerce sector is heavily affected by the return deliveries due to wrong or unverified addresses. E-commerce platforms require a swift solution to verify the addresses of their customers for fast and secure deliveries. Age verification is also a concern for e-commerce to prevent the access of age-restricted products to minors.
All of the above can be done by applying the latest KYC verification method i.e. through video verification. Combination of artificial intelligence, machine learning and human cross-check could effectively lower chances of any mistakes during this process.