The cost of manual identity verification
It wasn’t too long ago that all identity verifications were performed in-person at a physical location. An individual would look at documents, perhaps ask some questions or check some records, and then make an assessment.
Fortunately, technology has entered the picture, allowing for digital identity verification at scale and at speed. Just as important, these digital identity verification processes allow for remote identity proofing, enabling financial services, marketplaces, eCommerce and other interactive situations to fulfill the necessary compliance, security and trust requirements online.
However, while the technology supports the automation of identity verification for digital services, many organizations have yet to make the switch. For these organizations, the cost of manual verifications might not be considered, as they are already paying the staff who perform the task. But do they know the true costs of running manual verifications? Do they know how effective their current processes are, or how much they could they could improve their operations by introducing automated, digital identity verification?
The cost of human resources
Often, the highest cost for a business is human resources: wages and other costs to find, train and retain valuable staff. If your organization is using manual verifications, you’ll need to consider the time necessary for an employee to run that check as a direct cost. While that employee’s wages might already be accounted for, the time spent on manual processes is time taken away from other priorities.
Especially if the employee is highly trained in compliance matters, deploying them to run verification checks is not making full use of their knowledge and talents. In any case, manual verification is a dull, tedious task that contributes to lower morale and job satisfaction.
The cost of human error
Automated tools can perform tasks relentlessly, not becoming tired or prone to mistakes; the same can’t be said for people. Manual verifications imply manual data entry, which potentially introduces errors into the process. Errors can cause false rejections on verification checks, meaning that data has to be reentered, information has to be reacquired or accounts get rejected outright. Any of these results can lead to higher costs, a bad customer experience or a loss of revenue.
These mistakes can propagate through the system. Perhaps someone who should have been rejected as a money launderer gains an account. Or, an audit trail becomes difficult to resolve, because the data is inaccurate. Again, the results can be higher costs, notably if fines are handed out. There’s also the risk of reputational damage, which is hard to quantify but can be significant.
The cost of abandonment
In today’s online, mobile world, people have become used to instant gratification. They can get a coffee as soon as they walk into a store or get an account to a new service in minutes.
Having to actually travel to a location is a major impediment to signing up, especially when a competitor is a click away. Manual verification processes are not built for the realities of today’s business environment, let alone future opportunities.
Digital identity verification processes enable customer acquisition through online channels such as websites or apps. Business is not limited to store hours or geographical location. For any business that wants to grow operations online, ensuring that an effective automated verification process is in place is a critical piece of the puzzle.
It’s also imperative that the verification process be seamless and relatively quick from the user point of view. If account creation is too slow, asks too many questions or is otherwise problematic, the customer will often abandon and move on to competitors.
The benefit of an identity verification provider
While manual verifications are undesirable for the points noted above, does that mean that the answer is creating your own automated verification system? You’d need to find, vet, integrate and manage multiple data sources to acquire the necessary identity information to match against. You’d need to create the technology stack that can quickly check multiple data fields against multiple data sources, often with disparate information. You’d need to implement extremely high security and privacy protocols to protect the valuable personally identifiable information (PII) that you process.
Fortunately, there are a number of identity verification providers that specialize in this area and have already done all these steps for you. Thus, it’s just a matter of integrating with the service provider to start automating your verifications. Trulioo recently launched EmbedID, a low-code developer tool for generating preconfigured identity forms, to enable DIY integration for businesses who are looking to set themselves up for scalable, global expansion.
The benefit of a global business
Nowadays, consumers can just as easily be on the other side of the world as on the other side of the block. However, that assumes you can onboard that cross-border customer effectively.
That’s why, when you choose an identity verification provider, one major consideration should be country coverage. Can the provider verify customers from across the globe? Even if you aren’t getting prospects from a country now, any international expansion should not be held up by the requirement to find and integrate a new identity service.
It’s not simply about “having coverage.” Rather, it’s about getting the quality of data to perform proper identity checks at the speed and scale you require.
The benefit of trust
Identity verifications have always been important when opening sensitive accounts, such as financial services. Now, with many customers being remote, identity verifications are vital for many businesses that want to know who they are dealing with.
In this era of data breaches, preventing fraud or bad actors from gaining access to your services has never been more important. Ensuring compliance is as important as ever. Customers also want to know that their information is secure and protected. For almost any online organization, trust is crucial to success.
Don’t allow the trust you have in customers or the trust they have in you to be questioned. Automated identity verification allows you to build trust while minimizing the associated costs.