Account opening is a critical process in a Financial Institution (FI), where verifying the identity of potential customers is a regulatory KYC mandate. While lapses in this process may result in large fraud related financial losses, it could also be a predicate crime that leads to money laundering and terrorism financing - attracting regulatory scrutiny, huge fines and reputational loss.
Remote customer onboarding expectations are soaring – no longer a nice to have, it is now a key differentiator. Challenger “Digital only” banks are fuelling these expectations with the use of innovative technology solutions that address these demands at lower operational costs while staying compliant with regulations.
The identity of potential customers at the onboarding stage still requires documents to be verified. Criminal networks are becoming increasingly sophisticated and banks cannot simply rely on security experts who function based on visual detection methods. These manual verification methods are giving way to automated identity scanning technologies that detect forged identity documents, and along with biometrics have taken a central role in fighting identity fraud.
The aim of modern Identity Verification solutions are to support the Digital Transformation of banks by facilitating e-KYC with Remote Onboarding of Customers at speed while at the same time preventing the propagation of fraud schemes associated with New Account Opening process and enhancing compliance with KYC/AML regulations.
Advances in technology and the evolution of Artificial Intelligence (AI) and Machine Learning (ML) models are spurring innovation forward in many areas in the industry. Its use in the identity verification process has facilitated increased effectiveness and efficiencies in the fight against fraud.