Consumers leave endless trails of personal data across the web, so why do businesses need to perform identity verification checks each time someone applies for a new digital product or service? It’s simple—identity fraud.
In this article, we’ll explain how digital identity verification can prevent identity fraud, how our digital identities have evolved over time, and more.
What is Identity Verification?
Identity verification is the process of confirming an individual’s identity by validating the inputs provided by the user, such as name, date of birth, or SSN. In recent years, additional acceptable inputs for identity verification checks have expanded to include biometrics, such as fingerprint and facial recognition. Simply put, identity verification helps to answer the question, “Is this person real?”
Identity verification was initially adopted by financial institutions in order to comply with strict Anti-Money Laundering (AML) and Know Your Customers (KYC) regulations. Since then, digital identity verification is now used by a wide range of industries like ecommerce, healthcare, online gaming, and more.
Protecting Your Digital Persona
During the early days of the internet, most digital identities would have consisted of an email account and a few personal files (ie. pictures, music files, etc.) that were hosted in a cloud storage platform like Box or G-Drive.
Today, it’s different.
Some experts suggest that digital identities have evolved into full digital personas that accurately reflect an individual’s unique behavioral patterns, like shopping preferences and general browsing habits, and that everything you do online is tied to your digital footprint. As technology continues to get smarter, it is more important than ever for consumers to protect their digital identities from the ever-evolving threat of synthetic and traditional identity fraud.
The Need for Digital Identity Verification
Online transactions have steadily increased over the decade, and so have the instances of online identity fraud. Hackers and cyber criminals continue to use sophisticated methods to probe security flaws in identity verification gateways. And when they do exploit a security loophole, the ramifications can be devastating to both businesses and the consumers they serve.
For example, in 2014, Yahoo! reported a major security breach for over 14 billion user accounts. Similarly, The Marriott International group reported a breach of over 500 million accounts between 2014 and 2018.
What’s Next for Digital Identity Verification?
Despite recent efforts made by regulators to help consumers protect their data online, the heightened threat of identity fraud continues to plague consumers online. It’s imperative that businesses ensure their digital access points are up-to-date with the latest security patches and continue to educate consumers on best practices to keep their personal data secure.
Above all, the most effective way for businesses to protect themselves (and consumers) from disastrous identity fraud attacks is a highly sophisticated, yet simple to deploy identity verification solution. Digital identity verification can even be fully automated, allowing businesses to keep bad actors at bay while providing a quick, seamless onboarding experience for ‘good’ applicants.
To learn more about the importance of digital identity verification, stay tuned for our next blog, “Top 6 Reasons Why Digital Identity Verification is Crucial to the Growth and Safety of Your Business.”