Author: Tanvi Tapadia | Integrated Marketing Specialist | Global Data Consortium
The identity verification stage of an onboarding flow is one of the biggest sources of attrition. Too much verification activity can be full of friction and frustration for the customer. Too little, and your organization could risk non-compliance. Furthermore, as an organization expands to new global markets, there are new regulations to comply with and thus, new costs to add on.
Companies spent $15 million in non-compliance costs, 2.7 times higher than the cost of compliance. Although attempts have been made at compliance and risk management technology, 79% of compliance costs are still dedicated to personnel. To avoid a technological compliance system from becoming obsolete, investing in a compliant, verification solution could fill the gap between your proactive compliance processes and an airtight, KYC-compliant onboarding funnel.
Find Your Layers
Identity verification comes in many shapes and sizes. From biometric to document to electronic identity verification and more, it can be overwhelming to know where to start.
Electronic identity verification (eIDV) is known for giving customers an easy onboarding experience. Its low-friction, fast nature typically makes it the first line of defense for KYC compliance. By utilizing personal information such as name, date of birth, or national ID from various data sources such as mobile carrier databases, judicial registries, utility provider records, consumer and subscription records, and more, you can quickly confirm if an individual is who they claim to be. But what happens if they fail their first attempt at being verified?
The best way to give customers a smooth identity verification experience is to approach your verification solution from all sides.
- Finding the verification types that are right for your organization. There are many different types of verification, but we’ll describe a few here.
- Document verification: will your customers that need verification have or provide sensitive documents? Does your organization have the proper infrastructure to securely handle this type of Personally Identifiable Information (PII)?
- Biometric verification: does your verification audience have access to the technology or smartphone necessary to take a clear photo of themselves? Do they know how?
- Two Factor Authentication: one of the simplest identity verification methods is two-factor authentication but still requires access to another piece of technology.
- Familiarize yourself with global regulations, or find someone to do it for you.
- Many compliance costs come from investing in people rather than technology. While compliance officers are absolutely necessary, finding one that is familiar with regulations in every market can be hard.
- Global Data Consortium utilizes in-country data providers that have extensive knowledge of country-specific regulations. By leveraging authoritative data sources that refresh in real-time, your organization can have high-quality identity, AML- and KYC-compliant data to verify customers instantaneously.
- Evaluate, question, and iterate your current processes.
- As your organization grows and shifts, it’s important to evaluate costs and the tension between the onboarding experience and thorough compliance. Are your methods of verification still the right ones for your audience? Are they still reaching the right amount of compliance?
Go Out into the World!
Having a compliant business and an enjoyable onboarding experience does not have to be mutually exclusive, and the best way to do both is to layer up! By “waterfalling” each method of verification, you can ensure that your organization is taking reasonable measures to comply with AML and KYC requirements while giving customers the best experience possible.
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