Now that everything is going digital, businesses need to verify more and more consumers who they say they are. Digital ID verification is the process of verifying a customer’s identity electronically. This includes authenticating the attributes of a person and then verifying that these attributes belong to a real person. This allows the company to create a digital credential for a person, thus allowing them access to anything from banking apps to borrowing institutions, and more.
ID verification has three different types:
- Biographical information: User’s name or age
- A trusted ID document: a user’s passport or driver’s license
- Biometric data: User’s fingerprint or facial image
Online ID verification services use a combination of these services to build a legit user profile for a person. The number of people who want and are currently using digital services is increasing rapidly. So, it makes sense that businesses need to invest in online ID verification technologies.
Challenges Faced in Digital ID Verification
1. Variety of Documents
On average, there are over 6,000 types of documents globally that can be used for ID verification. Each document type has its own unique protection against fraud, but some documents are easier to forge than other documents.
To verify an ID document and authenticate a user’s identity, an image of the ID, the visible data on the ID, and any additional information stored within the document. Once the data is extracted, it is analyzed for authenticity.
Even if you limit the type of ID documents a student can use to verify themselves, complex algorithms are required to identify which document type the ID is.
2. Evolving Biometric Forgery
Once the ID document has been verified, the next step is to confirm the validity of the applicant, but are the customers who they say they are. This is done by comparing the facial image with the photo on the ID document. Some companies can even choose to ask for face liveness detection.
This step of ID validation also has its issues. It is more than common for a legit user to fail a facial matching exercise due to bad lighting conditions. Additionally, instances of biometric data forging are becoming common.
3. Building for Everyone
According to some reports, over 1.1 billion people globally don’t have any sort of official ID document. It is impossible for a business to verify a person with ID documents if they don’t have any documents, to begin with. When developing a digital identity verification service for the public, it is important to think about the potential users who:
- Are not digitally literate
- Don’t have clear migration status
- Cannot provide biometrics due to physical appearances or features
- Have opposing religious or personal beliefs to the capture of biometrics.
4. Finding Balance between Compliance and User Experience
Financial institutions, banks, and other firms have to follow through on strict regulations. These regulations differ company by company. For these businesses, they need to have a strong online ID verification process. Additionally, they need to focus on seamless customer experience. Most customers care more about a smooth experience while onboarding instead of a strict, and secure process.
When developing ID verification services, businesses need to carefully plan acceptable thresholds for rejection, which balances out the risk of potentially accepting fraudulent identities.
5. Privacy, Data Security & Trust
Privacy controls are essential for services that rely completely on personal, biographic, or biometric data. Legally, users need to stay informed about how their data is being managed, stored, and maintained. Banks and financial institutions should also provide a certain degree of control over the consumer’s data.
The introduction of the European GDPR has helped in protecting the data of the consumers, but governments and businesses need to build their frameworks for data management. This can include providing control over data.
Reducing the risk of security breaches and improving how a business handles the data is crucial for all kinds of business.
Final Take: Challenges for Digital ID Verification
It doesn’t matter how big or small the business is, every step in digitization needs some challenges to be addressed. The key to building a successful digital ID verification is finding the perfect mid-point between the user’s experience and security. Companies should also focus on handling all the privacy and security needs. Maintaining all this, and still keeping a high customer onboarding rate is the perfect strategy for fraud deterring.
