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5 Biggest Challenges Faced During Online Identity Verification Process

The whole idea of identity verification has grown past manually verifying each customer one at a time. Just like everything, online technologies have also improved the way the identity verification process works. Verification and management of online customer identities are more flexible than ever. Systems and solutions built especially for online identity verification are crucial to providing authentic proof of identity for accessing and operating in combination with modern banking systems, e-commerce platforms, third-party payment aggregators, and more. Unfortunately, the rise of technology has given birth to the problem with online identity verification.

As AI-based technologies are becoming more streamlined, organizations try to embrace them to reach more people and provide better security. Technology is not only being used by banks, financial institutions, and others, they are also being used by sophisticated criminals. Keeping up with high-security standards and following strict regulations are some of the most common challenges of online identity verification.

Providing smooth onboarding and secure online transactions can be tough. This is one of the most common problems with online identity verification.

Here are 5 Challenges during the ID Verification Process:

Let’s dive into the main and common challenges…

1. Inefficient and Expensive Costly Identity Verification Solutions

As an online solution, online identity verification is still taking its baby steps. Verification of identity comes in multiple variants, and there are multiple methods for how identity is verified. The entire process of verifying identities used to be pretty simple, but as online transactions have grown in both volume and complexity, the process of digital identity verification has expanded into something else altogether.

For unique sources and channels, users are uncomfortable sharing personal information for verification. Basic details like name, address, and government-issued IDs are not good enough to get a complete idea of a person’s identity. To get more personal details about a customer and verify their identity, organizations need to act responsibly and try to bridge the trust gap between technology and trust.

As more and more people enter the identity verification market, and the volatile nature of the industry, the online identity verification process is not stable. This constantly changing market leads to irregularities when it comes to the serviceability and security of identity verification services. 

Businesses that deal in financial transactions are putting in their best efforts to keep up with ever-changing state laws and regulations. These changes in regulations are being done to keep up with the growing data privacy needs. 

To reduce the risks of security breaches and compliance risks, businesses will need to stay ahead of changing industry trends. Organizations also need to understand how to manage confidential data such as customers’ personal information. It is one of the primary problems with online identity verification.

2. Trouble Determining the Accuracy of Identity Verification

Being able to accomplish efficient and frictionless identity verification is the key to building a solid customer base and building trust. To make this happen, it is required to integrate identity verification solutions and engage with large audiences. Fraud prevention using the KYC procedure is extremely important.

To get ahead of this challenge, technology and back-end support have to be updated with time, and using tangible resource investments is crucial to maintaining secure platforms.

3. Data Availability and Management Issues

Cross-referencing even the smallest data point is the most vital part of the identity verification process. This leads to collecting personally identifiable information such as social security numbers. Collecting this array of information is essential for firms, but most customers won’t provide the information as it makes them uneasy. Providing basic information and credit reports can make customers susceptible to risks.

To ensure customers that your organization provides a maximum level of security and risk management. Organizations must provide users with control over data collection methods and how they use personal details for online verification.

To accomplish high security and service standards, companies will need to search for solutions that can provide them with online databases. To do comprehensive identity verification, personal information needs to be cross-checked on these databases.

4. Complying with Data Protection & Privacy Regulations

With the sudden increase in the application of online identity verification, the requirement to comply with regulations is also becoming strict. Organizations will have to keep up with the ever-changing rules and policies. 

While digital technologies are huge enablers of customer-friendly services, this is also leading to concerns about data security. International standards and regulations are catching up with technological advancements and providing a helping hand in protecting data. 

The GDPR came into existence in 2018, since then it has been a guiding system for regulated companies. Similar to GDPR, Anti-Money Laundering Directive 6 has been the central framework for fighting money laundering and terrorist funding. 

These regulations are extremely vital for industries like online gaming, dating, and gambling sites. Usually, these sites contain age-restricted content, and digital identity verification regulations protect minors from financial crimes and identity theft. Not being able to comply with regulations makes it one of the primary challenges of online identity verification.

5. Improving Digital Trust & Customer Experience

Customers can rely on several digital banking services in the current system. High-risk transactions, malicious data collection, and not user-friendly databases are enough to ruin the experience for both new and old customers. Establishing trust in the market and ensuring a high level of trust is crucial to building a long-lasting business operation. Not being able to improve the customer experience is one of the biggest online identity verification problems.

Digital identity management data is based on fighting for the right solution for the users and extending a hand in data management. Online identity verification services need to be built, to make sure that the needs of the customer are being fulfilled. Unless firms learn how to improve customer experience this will remain one of the main online identity verification problems.

How does DIRO’s Document Verification Technology Assist In ID Verification?

The online identity verification landscape is in its first steps, and it is riddled with challenges. For banks, financial institutions, and organizations to verify identities online, it is required to get past those challenges.

DIRO document verification API can verify documents instantly and capture information right from the original web source. Verifying documents is the first step in verifying customer identities. Verified information is placed on the blockchain, which makes the documents immutable and secure.

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How to Avoid Bank Frauds Using Technology?

Want to know how to avoid bank fraud? Well, the first step is to follow the basic old-school step with a blend of technology. Fraud is a worldwide phenomenon that affects all multiple industries and can even have a severe impact on the economy of a country. Banks need to understand how to prevent bank frauds, which they can’t do without employing the right kind of technology. One of the most challenging aspects of the banking sector is to make sure that all online transactions are free from any kind of electronic fraud. Technological advancement and adoption is the only answer to the question of “how to control fraud in banks”.

By utilizing the power of data analytics, banks can detect fraud in their initial step and reduce the negative impacts of significant losses regarding fraud. This is one of the primary methods how to prevent bank fraud.

The present-day studies indicate that false documentation and inadequate training of employees are the reason for 60% of all banking fraud cases. Most of the frauds in banking institutions are detected through customer complaints or some external tip, which is the case with global banking frauds. To mitigate risks, banks need to learn how to prevent online banking fraud. 

Large and small businesses alike are targets of online bank frauds, it is also called ACH fraud or wire fraud. Once cybercriminals can find a weak point in the banking system, they can create a lot of nuisance before being detected finally. 

Banks, financial institutions, and FinTechs need to understand the need for technology so they can reduce the number of frauds they have to suffer through. If you wish to understand how to prevent online banking fraud, then you need to employ technologies such as DIRO’s document verification technology.

Technologies For Online Banking Fraud Prevention

1. Multi-Factor Authentication

The best step is to start with a multi-factor authentication structure to improve the first layer of security. Financial institutions can’t solve all their problems just by using multi-layer authentication, they need to start from somewhere. One of the major mistakes made by financial institutions is to leave everything on a single solution which makes them more open to being compromised.

If financial institutions can set up a solution like combining old-fashioned phone calls for bank authentication with online two-factor authentication, they can reduce the risk of fraud by a lot. In the old days of banking, calendars were put in place for all transactions across multiple accounts. If someone has the same banking and transaction routine, then any sudden changes would be marked as red flags. 

2. Banks Need to Monitor Transactions

In the earlier days of banking, banks used to have daily limits imposed on their users. The banks used to impose the limit on their mainframe processor, along with file limits and batch limits, this limit would help to spot if there was something out of the ordinary. Usually, banks don’t watch out for any activity under $9,000 which makes it easier for criminals to fraud the banks by conducting activities under $9,000. One of the best ways how to prevent bank fraud is to monitor transactions more carefully.

3. Employ Dual & Triple Controls

Dual controls on the corporate side are the minimum they can do to reduce the risk of online fraud. The ideal suggestion is to use triple controls, where one person initiates the transaction, a second person approves the transaction and the third person finishes it.

If organizations don’t have the right kind of resources or people to follow up with the triple controls, then they need to set up ACH transactions. Businesses can confirm using a phone call if the transaction was initiated by a specific person, once that is confirmed, the transaction can be completed. This can be done using a person or by setting up an IVR. Usually, only one person will have the ID and password to call the bank and complete the transaction which adds an extra layer of security.

4. Raise Awareness Towards Fraud

One of the best ways how to control fraud in banks is to keep educating the customers about the ways they can reduce fraud. The rise of online banking has given rise to a lot of online fraud. Banks and other financial institutions can employ all the technology they want but the real solution won’t happen till customers are aware of the threats.

5. DIRO Document Verification Technology

This is one hardcore technological solution to make sure banks, financial institutions, and FinTechs can mitigate the risk of online fraud. Using the technology, organizations can streamline the customer onboarding process and verify documents to reduce online fraud and money laundering. 

DIRO’s document verification technology can verify documents like bank statements, bank account verification, utility bills, address proof, and student records. During the customer onboarding process, banks can verify customer documents to make sure the customers are who they say they are. Money laundering and terrorist funding can be stopped by verifying customers before they can cause any real problems.

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How eID Verification Improves Client Onboarding for Banks and FinTech

It can be very time-consuming for individuals or business owners to take time out of their day to visit banks when they prefer to interact with their Financial institutions online. In this article, we will discuss the benefits of eIDs and streamlining cross-border transactions and how they can improve the client onboarding process. The big challenge for banks and FinTechs is to verify documents to prevent fake and stolen when onboarding new clients. This challenge is common across mortgages, auto lending, or purchases that you may need to start a new business.

Customers who work night shifts can find the limited opening hours of the banks and other financial institutions frustrating. Let’s say you want to sign a document, but you work during the opening hours of the banks. This presents a real challenge and the way to solve it is through more online services.

There are a lot of steps involved in loan approval and the process can easily be delayed while waiting for the customer’s signatures. This waiting period can lead to the bank or financial institution losing the client and makes the entire process inefficient. Instead, if banks can conduct verifications online it could be very beneficial to the customer. This can help especially during cross-border transactions. Online eID verification can reduce the need for customers to travel to distant locations to provide signatures. Whenever document verification can be done online, it can improve the overall level of efficiency.

However, to achieve this, banks and other financial institutions need to put security measures in place. Both the individual and their bank would have to start with an online identification process to ensure that people are who they claim to be. This is where online document verification and European regulations such as eIDAS come into play.

What is eIDV?

eIDV (electronic identity verification) uses publically available data and private databases to verify documents for verifying a person’s claim to whom they say they are. eID verification utilizes personal information like name, DOB, Social Security Number, and address among other types of data. The result of an eID verification could result in the person claiming who they are, a partial match of identity, or a fake or stolen identity.

eID verification is used by banks, brokerage firms, credit card companies, lending, money transfer, and mortgage companies to minimize the risk of financial fraud, and comply with KYC, AML, and CFT regulations. Other sectors that use electronic document verification are:

  • Insurance companies
  • Governments
  • Online gaming 
  • Lawyers
  • Employers
  • Job recruiters 
  • Real estate agents

Use of eIDV in Financial Institutions

Electronic identity verification matches the data that is offered by users to banks and other financial institutions. This information can include name, date of birth, address, and Social Security Number against multiple databases available online.

  • Personal documents can be used as a source of document verification. These documents can be driver’s licenses, passports, birth certificates, and citizenship certificates.
  • Several databases can be used for eID verification such as public and proprietary, credit bureau data, government databases, etc.
  • Data that can be used as a source of verification by financial institutions can include address, postal data, property ownership data, credit bureau data, utility data, government data, etc.

Advantages of eID Verification

There is a certain cost associated with verifying the identity of a person, but it can be much less expensive in the long run to avoid the risk of doing business with individuals who use fake and stolen documents.

eID verification can detect fraud by verifying the passport provided by a customer to verify if a customer is real or not. eIDV can also be used to verify the identities of potential customers and if they are on the international watchlist, politically exposed people list, or on some other lists that can make them a potential risk for banks and other financial institutions.

Electronic identity verification can not only be used to verify documents and customer identities but can also be used to stay up to date with your existing customers. Businesses pay more money for eID verification services that can cross-check databases to authenticate documents and identity.

Why Should Financial Institutions Switch to eIDV?

Electronic identity verification services come with a lot of benefits. Banks, financial institutions, and FinTechs used to spend a lot of time and money verifying identities and documents using manual methods.

With the rise of technology, financial institutions can step away from the collection of POI (Proof of Identity) documents. They can instead conduct this using electronic identity verification by cross-checking information provided by customers during the onboarding process.

eIDV for a Speedy and Secure Customer Onboarding

Using eIDV will improve the customer onboarding process by gathering all the relevant information. The success of electronic identity verification solely relies on cross-checking the data from all available public, private, or government databases.

All the information must match up properly, for example, the name on the customer’s credit card should meet with other documents and the address provided. This improves data security and saves banks and financial institutions from fraudulent applications. To do this ideally, banks and other financial institutions need to have access to billions of data records globally. There are technologies out there that can provide secure eID verification online all while complying with KYC and AML regulations.

How DIRO’s Technology Can Improve the Customer Onboarding Process?

DIRO document verification technology can be used by banks, financial institutions, and FinTechs to verify documents of any kind. DIRO’s technology can capture original documents from the original web source and it can be used to prove whether a document is authentic or not.

Banks, financial institutions, and Fintechs can with user permission access all banks, utility company data, government databases, and private databases and cross-check documents with automated user consent and strong impersonation checks. Using DIRO’s document verification technology, users can access all:

  • Online utility companies for verifying proof of address.
  • Verify personal Online bank data.
  • Online insurance companies to verify coverage.
  • Online government portals for proof of income, tax returns, and more.
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Types of Bank Account Verification Methods & How DIRO Facilitates Account Verification?

types of bank account verification

Verifying a bank account is one of the most crucial parts of minimizing the risks of fraud and scams for a bank, financial organization, or FinTechs. With the technology growing at an incredible pace, ACH transactions are at an all-time high. Bank account verification is crucial during online funds transfers commonly known as ACH transactions as it ensures where the funds are coming from and if they are associated with any malicious activities. 

Many businesses are offering online payments in alternative to payment methods such as credit cards and paper checks. Finding an ideal method of bank verification can be suitable for users as it improves user experience. 

Using the right methods of bank verification will allow you to mitigate the risks of fraud and scams.

Reliable Bank Account Verification Methods

Banks, financial organizations, and other FinTechs need to employ the methods for bank account verification if they intend to keep their brand reputation intact. Here are the best bank account verification methods to keep an eye out for.

1. Use Micro Deposits Verification

Micro-deposits are deposits of less than ten cents transferred from one financial institution to another that can help in verifying if a specific account type is valid or not. If a bank does not offer the feature of online banking or if the users can’t remember their credentials even then they can make micro-deposits for account verification as it is a self-contained process. 

When using micro-deposit verifications, the user will fill in their bank account and routing information. Two small credits are sent to the customer’s account that will be reflected in 1-5 business days. These amounts will confirm that the user can access their own account. 

2. Instant Account Verification Service (IAV)

The fastest method of bank account verification is by using the instant account verification service from the bank itself. Using instant account verification can even improve your overall user experience. With IAV, a user is asked to choose their bank and submit their online banking credentials to verify the account. In just mere seconds, the bank account is verified and the users can start with their banking features.

3. Third-Party Bank Verification Methods

A check verification service or a third-party bank verification service provides businesses, individuals, or other financial institutions with the ability to check the validity of the account. 

Third-party bank account verification can be done using multiple methods such as checking different databases with negative account history, checking to route and account number is valid or not, orax contacting the bank directly to confirm the information.

How does DIRO Improve the Account Verification Process?

DIRO’s technology captures original documents from any web source online. Using DIRO’s technology, users can verify bank account documents (any kind of documents) that can assist banks & FinTechs in verifying bank accounts and reduce the risk of frauds and scams. 

All types of bank account verification can be done in seconds using DIRO bank account verification technology. Even the best bank account verification methods can often fail to verify cleverly fabricated bank documents. DIRO verifies the documents against the original web source to reduce the risk of financial crime.

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Hollywood Actor Arrested By Feds In $227M Ponzi Scheme Including Netflix and HBO: Report by Deadline

Scammed Out

A real-life story that can be a plot of a crime thriller where Netflix and HBO helped the FBI to bring to justice a scammer who scammed investors out of hundreds of millions of dollars. 

Zachary Horwitz, who used the screen name “Zach Avery” was taken into custody by the FBI a few days ago, on charges of allegedly scamming people for more than $227 million. The people who were scammed thought they were going to cash in with licensing rights to films by WarnerMedia-owned cabler and the streamer in Latin America. 

An affidavit from FBI Special Agent John Verrastoro declared “In reality, neither HORWITZ nor 1inMM Capital ever engaged in email correspondence with Netflix or HBO, nor did HORWITZ or 1inMM Capital ever have any business relationship with Netflix or HBO at all”. 

As fake as the promises may be, Zachary Horwitz was successfully running the scam for several years, with limited questions asked by greedy investors as they were getting enough money. Although in 2019, his production company didn’t follow up on its initial notes, which stated “time-causing audits” and “corporate restructuring” at Netflix and HBO, which obviously wasn’t true. 

Both Netflix’s Director of Content Litigation “Melinda LeMoine” and WarnerMedia’s Senior Litigation Administrator “Patrick Younan” were a part of shutting down Zachary Horwitz’s fake company. Both of them denied a collaboration between 1inMM and Netflix and HBO. They also confirmed that any email regarding the topic was forged. 

To support his claims, Horwitz repeatedly sent emails in which he forwarded made up email conversations with the employees at Netflix and HBO. To find out the whole situation gets sorted out quickly, both Melinda LeMoine and Patrick Younan made important steps. Both the executives have signed a declaration to the FBI, which stated that neither they nor their organization had any relationship with Horwitz or 1inMM.

Horwitz promised financial investors a 35% return on their investments by claiming that his production company had licensing agreements with Netflix and HBO. 

As it was cleared by Netflix and WarnerMedia Executives, these relationships never existed and he scammed investors out of $227m in the last 3 years. Using this money, Horwitz allegedly built his sprawling home, which contained a cinema, a gym, and a wine cellar. According to court documents, he also used more than $137,000 on private jets and paid $700,000 to a celebrity interior designer. 
The case is currently under proceedings, and Zachary Horwitz may face up to 20 years of imprisonment if deemed guilty. 

How DIRO Can Help Organizations Reduce Fraud & Scams?

With user permission, DIRO helps companies get instant access to consumer information held by any third-party website with global coverage. Further, DIRO can authenticate documents such as bank statements, utility statements, proof of employment, proof of income, tax returns, company registrations, and proof of assets directly from its original web source.

In this specific case of the Netflix and HBO scam, investors need to know the difference between authentic and fabricated bank statements. DIRO document verification technology allows you to check and verify bank statements with automated user consent using a secure virtual browser. 

If an organization can verify documents right from the beginning of a relationship, it can reduce the risk of being scammed by at least 20%.

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Challenges In Establishing Trust In Growing Digital Banking Payment Systems Globally

trust in digital banking payment system

As time spent online is growing at an exponential rate, the demand for digital services and solutions is at an all-time high. This demand for online services includes the banking sector as well. In the last few years, digital banking or online banking systems have grown rapidly and offer better and more effective solutions than traditional financial institutions.

Switching to digital solutions instead of physical methods of banking can prove to be incredibly convenient as customers can access all banking services 24/7 right from their phones or computers. Digital banking payment systems can reach more people across the globe in comparison to physical banking. With this sudden growth of options and banking, digital banking payment systems have become globally accepted, but one major factor remains, which is “Building trust”.

In this era of technological advancement, digital banking fraud is also growing. How can banks and other financial institutions save themselves from digital banking fraud?

Digital Banking vs Online Banking

Most users think that digital banking and online banking are the same things. The debate of digital banking vs online banking has been going on for a long time. 

Digital banking is a solution where all the aspects of financial-related services are done through digital channels instead of visiting a physical bank. Online banking on the other hand offers only the core features of banking through an app or a website. 

Digital banking digitizes every activity of the bank undertaken by the customers. Digital banking represents all the activities that can be done through a physical branch, and it offers even more features. 

Challenger Banks vs Neobanks

A challenger bank has both the physical presence of a bank and it also offers complete digital banking solutions. Challenger banks offer both digital banking payment systems and traditional payment methods. Their footprint is significantly smaller in comparison to more widely known traditional banks. 

Neobanks on the other hand, offer a wide range of financial and banking services completely through digital channels. Neobanks are basically a type of FinTechs that operates under a banking license that they either acquired as an independent entity or rented from a bank.

Both Challenger banks and Neobanks focus on improving customer experience and transparency. Their main goal is to offer brilliant services to compete with traditional banks that have a bigger footprint. Knowing their customers and building trust in digital payment systems from the moment of onboarding till their entire lifecycle is a crucial strategy for these types of FinTechs. 

Both of them offer smooth and complete digital account opening facilities. They also keep adopting new technologies to prevent digital banking fraud.

Open Banking Systems

Open banking systems work in favor of customers’ demand for more choices, improved customer experience, and more control over their personal information. This is the system where customers are allowed to access and control their banking or financial accounts through third-party apps.

It prevents digital banking fraud by offering third-party financial services to open accounts, make transactions, and use any other financial data from banks and non-banks with the help of APIs. All of this control helps consumers access products and services across different institutions. These types of banks offer trust in digital banking systems as they employ the best security of technology to prevent digital banking fraud.

Use of Technology To Build Trust In Digital Banking System

A huge percentage of consumers feel that open banking will have a huge impact on how the banking industry works globally. According to several reports and surveys, it is expected that the open banking industry will have a revenue of £7.2bn.

It is expected that Neobanks and others can help in improving the banking industry to a more secure solution. One of the primary reasons these types of banks rely on technology so much is that they lack the resources to compete with traditional banks that have hundreds of thousands of physical branches. As they lack infrastructure, they rely on technology for complete automation of their banking operations, these operations can range from account opening to customer support.

All banks must keep up to date with digital fraud prevention and adopt newer technologies that can help you with digital fraud prevention. If the banks can utilize the right kind of onboarding technologies to reduce friction and improve the efficiency of the whole process with minimal error. Using this, banks can have a strong advantage over their competitors that are still going through the digital transformation process.

To build trust in the digital banking system, these are the most important questions a bank needs to ask:

  • Is this a real person?
  • Is this person who they claim to be?
  • Can I do business with this person?
  • Should I do business with this person?

Complete security and a satisfactory customer experience are vital components for success in the banking sector. Customers have to be able to trust that their personal and financial data is protected by the bank. And the banks who are looking forward to complying with industry regulations and AML practices, need to make sure that the customers are worth trusting from onboarding till the end of the relationship.

If a bank doesn’t have the proper technology, then fraudsters who know their way around technology can manipulate documents and cause millions of dollars worth of losses. FinTechs that make use of identity proofing and AML, KYC, document verification, and biometrics as part of their onboarding process will have a better chance at digital fraud prevention.

Integrated Method to Fight Digital Fraud

It is known that the best way to detect fraud, control, and fight financial crime is during the customer onboarding process. Low-friction KYC technology is important to make sure that the customers won’t abandon the process. 

Despite knowing this, many digital onboarding processes continue to be static and only used during customer acquisition which leaves a lot of room for error. They don’t make use of machine learning and advanced algorithms to identify if a user can be trusted or not and prevent fraud. 

How Does DIRO’s Technology Tackle The Problem?

Trust in the digital banking system is a tricky thing to establish, that’s where DIRO’s award-winning technology comes in. DIRO helps in making the onboarding process faster than ever by using brilliant document verification technology. 

Banks or Financial institutions can make use of the technology to verify if the customer is real or not. This minimizes the risk for fraud prevention, as DIRO document verification can help in following KYC and AML compliance with ease.

The technology offered by DIRO can be used by all kinds of banks, financial institutions, and FinTechs to verify documents in a secure environment. You can easily verify bank statements, address proof, and utility bills. To improve trust in the digital banking system, banks need to utilize this technology.

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Technologies For Fighting Financial Crime

technologies for fighting financial crime

The digitization of the world has become the stepping stone of all kinds of online fraud, no matter how big or how small. Institutions of all kinds are trying their best to develop or make use of existing technologies that can help them fight all kinds of financial crime. Financial crime identification is as crucial as employing technologies for fighting financial crime.

Technologies for fighting financial crime are being combined with human intelligence to create a powerful technology that helps in huge team compliance. To prevent financial crime, businesses and other institutions that use KYC/AML processing need to use technologies for fighting financial crime.

Rise of Financial Crime

According to a global survey, it was revealed that more than 3,000 managers who deal with compliance-related operations had come across multiple financial crimes during their operations.

Even with the rise of technology, financial crime remains prevalent. The loss from some specific financial crime can cause a lot of money. This is why technologies for financial crime prevention are crucial.

During the survey including banks, financial technology businesses, and other institutions, the thing that came to light was that financial crime had multiple disadvantages. Several organizations lost their corporate value, lost investor confidence, and some businesses lost their brand reputations and supplier relationships as well. 

All the businesses could have saved themselves from losses if they had the right financial crime identification methods in place. To prevent financial crime, institutions need to make use of the right technologies for fighting financial crime. As of right now, there is a clear and urgent requirement for organizations to employ innovative technologies to tackle the problem of financial crime with a new approach.

Technologies For Fighting Financial Crime

1. Due Diligence Checks

Huge organizations with a large number of due diligence processes spend around 4 percent of annual turnover on third-party due diligence checks. Regardless of using third-party organizations for due diligence checks, almost half of the new relationships with businesses don’t have the needed due diligence checks.

This huge gap in the compliance process like KYC/AML can allow financial crimes to go undetected until a huge loss has been incurred by businesses. The ideal way to prevent financial crime is by adding more heads to the due diligence process. Adding more budget to the due diligence process can save organizations to suffer heavy losses. 

2. Constantly Adopting New Technologies

A lot of organizations are already making their way towards newer technologies, the main purpose of the technologies is to enhance the compliance process and prevent financial crimes. 

A survey conducted by businesses showed that most businesses are embracing cloud base data and technologies for financial crime prevention. Also, around 50% of people are using API-based document verification technologies, others are using artificial intelligence and machine learning-based technologies.

In institutions where the technology isn’t applied, there can be huge losses. There are even organizations that showed no interest in employing newer technologies.

3. Faster Onboarding Process

Technologies for fighting financial crime can enhance multiple parts of the business. Making use of newer technologies can offer so many benefits. The intelligent use of technology can:

  • Speed up onboarding process
  • Reduce strain on existing resources
  • Reduce the risk of human error
  • Allow organizations to onboard more customers
  • Can decrease the onboarding times and shorter time for revenue generation. 

Almost all the top technologies for document verification or financial crime prevention are cost-effective. Apart from being cost-effective, they can enhance the overall client experience.

4. Trusted Human Experience

Businesses that use technology to prevent financial crime are more likely to find success while completing onboarding checks. After realizing this, organizations are trying to pour more funds into investing in newer technologies.

In upcoming years, the expenses on third-party due diligence checks are expected to grow by up to 50%.

5. DIRO’s Online Document Verification Technology

Using DIRO, institutions can easily verify any person or information from any bank, utility company, or government. DIRO guarantees that you can trust each PDF and use them as an original document in KYC compliance and all kinds of other processes.

DIRO is one of the best technologies for fighting financial crime. Using them, you can reduce the risks of financial crime in your business operations. Businesses who are not afraid of adopting newer technologies for financial crime prevention, can try DIRO for free or even get a demo on how it works.