Community banks have been feeling the squeeze on their revenue for quite some time now, and current economic conditions have put further downward pressure on revenue sources. On August 25th, the FDIC announced that the average net interest margin (NIM) fell by 58 basis points from a year ago to 2.81%. This is the lowest level ever reported in the Quarterly Banking Profile.
Looking for more revenue from existing business lines, community banks are increasingly partnering with fintechs to grow their respective businesses, customers and profits. Banks gain access to lucrative new income streams like low cost deposits, resulting in NIM growth and interchange fees. In return, fintechs gain the ability to extend their products into new verticals and markets with access to certain aspects of the U.S. financial system, such as money movement (payments), card issuance, DDA, high-yield savings accounts, lending and more.
These partnerships often rely on outdated onboarding, identity fraud detection, and document verification systems that prevent good customers from gaining access to much needed financial services, leaving money on the table for banks and their fintech clients. With the need to onboard customers online, speed and accuracy are top priorities and every customer and prospect is precious, to both the bank and the fintech. You cannot afford to lose prospective customers with clunky online onboarding processes or worse, to turn down good customers by way of legacy KBA/OOW. Of course, fraud is also a top consideration. New customers can equal more fraud, fraud losses, and ever expanding manual review queues. Accurately identifying fraud in an instant, automated fashion saves money, protects resources and streamlines operations.
Today, forward thinking banks and fintechs are growing their businesses with new digital identity verification capabilities that convert and onboard customers faster and more safely than ever before. Socure is a leading vendor in the identity verification space that leverages machine learning combined with vast data sources to identify fraud, implement KYC/CIP, verify documents in real-time and provide continuous AML monitoring. Simply put, its suite of products were purpose built to accommodate the digital first financial and commerce world.
The Socure Solution
Socure’s best-in-class ID+ digital identity verification platform automates fraud detection, compliance, and document verification in a single platform with industry leading accuracy, responsiveness and the fewest false positives—in the riskiest centiles of a user population that matter most. By streamlining the onboarding process while reducing identity fraud, Socure helps banks drive more income from sourcing granular deposits at little-to-no cost while driving interchange revenues. Banks are able to monetize existing lines of business with mutual benefit to their downstream fintech clients.
Using Socure, five of the top digital-only banks have improved all metrics across operations:
- Auto acceptance improved from 62% to 85%
- Reduced the need for KBA by 60%
- Improved overall customer experience
The Socure ID+ platform uses trusted online, offline and social media data to deliver industry leading auto-approval rates while simultaneously reducing fraud and false positives. Additional products on the platform include:
- Sigma Fraud Score: achieves superior performance and accuracy by reducing fraud for online new account openings up to 95% with false positives of better than 1:1
- Synthetic Fraud: Socure’s newest module, auto-capturing over 90% of synthetic fraud in the riskiest 3% of users, for both new and existing accounts
- DocV: new, fully automated omnichannel document verification service, can be implemented right at onboarding or as a step-up mechanism
- Email risk, phone risk, and address risk correlation scores: verify email, phone and address match and belong to the presented identity
- Intelligent KYC and Watchlist Screening with Monitoring, the most advanced KYC/AML solution in the market, delivers 90% auto-approval rates or higher on average
By using Socure’s ID+ identity verification platform, sponsor banks—like MVB—and their fintech partners are quickly and safely onboarding new customers, while avoiding fraud losses and ballooning costs from manual reviews.
To learn more about how Socure identifies real people in real-time, please reach out firstname.lastname@example.org or schedule a demo today.