The online economy is revolutionizing our lives, creating exciting opportunities for both consumers and businesses. However, these same techniques are also increasingly enabling scammers and online criminals. Businesses need to make sure their remote identity verification procedures can reliably tell good actors from bad ones and safeguard all the sensitive personal data that customers provide them.
According to Experian, in 2022, financial losses as a result of fraud jumped 77% from the previous year (2021), to more than $6.1 billion. What’s more to consider is the fact that in 2022, the global cost of cybercrime was estimated at about 8.4 trillion dollars, according to Statista. By 2023, the cost of incidents brought on by illegal online activity is predicted to surpass the 11 trillion U.S. dollar mark. In addition, privacy regulations like the GDPR (General Data Protection Regulation) and CCPA (California Consumer Privacy Act) have increased the cost of compliance and operating a business. Companies that make wise investments in their onboarding procedures can keep costs under control, maximize customer acquisition, and put themselves in a position to take advantage of emerging market, technology, and risk prevention possibilities.
Nowadays, a number of companies are looking to data to help them make more strategic decisions concerning identity verification. Identity verification has changed in recent years from being viewed as a tactical compliance effort to becoming a key strategic driver of customer and corporate value, a shift that has been amplified by the pandemic. Businesses in all sectors, from those making their first digital move to those with a long history of operating online, now prioritize identity verification as a top priority.
Investment factors for identity verification
In an effort to be the best in their field, gain customers’ trust, improve the customer experience, and gain a competitive edge, many businesses are now actively pursuing identity verification. After all, 80% of customers said they would be more willing to interact with a business online if it had strong identity verification methods in place, according to the 2022 Jumio Global Consumer Research report centered on digital identification.
There are some questions, though. How do companies evaluate the success or returns of the money they spend on identification services and technology? What are the Customer Due Diligence KPIs and significant metrics that they are overseeing? How does customer identification and verification measurement need to change in order to support and strengthen its new strategic significance?
Here are five essential steps that can help your company create best practices for your identity verification procedures:
- Specify your objectives
To fully comprehend the needs for identity verification, one must have a thorough awareness of the parameters under which the business operates.
- Identity what constitutes success
Provide a comprehensive and reliable system to assess the effectiveness of identity verification procedures and investments.
- Use the appropriate tools
Use the best tools you have at your disposal, ones that meet your needs and can be linked together to create a dynamic verification process that reduces the risk of fraud and compliance violations while also reducing friction.
- Prioritize optimization
Make sure the performance of your identity verification program is optimal at each stage of the customer experience.
- Put tiering in place
Tiering is a waterfall method of identity verification that enables companies to always choose the best source for identity verification based on each specific circumstance. Dynamic routing is made possible by it, and this boosts performance, gets rid of fraud, and enhances the customer experience.
Five key questions to ask to improve ROI in IDV
Today’s progressive companies are approaching identity verification more strategically, realizing its significance goes beyond fraud prevention and legal compliance. Optimized identity verification and onboarding, which take place at the beginning of the customer journey, set the atmosphere of the whole experience and can increase customer loyalty and decrease abandonment. These are some questions you should ask in order to get the most out of your investment in identity verification.
In order to get the most out of your investment in identity verification, you should consider the following questions.
- How important is a verified individual to your company?Establish your objectives for identity verification and customer onboarding to make sure your processes are compliant, flexible, and scalable.
- Do you have the proper equipment to safeguard customers and provide a fantastic onboarding experience? Develop a multi-layered strategy for identity verification so you can onboard new customers in any circumstance.
- For each risk profile, are you reviewing identity verification sources and workflows?Make your choice of a platform that enables you to create, test, and deploy verification workflows that are quick and secure in every market.
- How well is each source of verification doing, and how can outcomes be enhanced? Use a tiered strategy that enables your company to continuously navigate to the best, most pertinent data source for identity verification.
- Which KPIs ought to be monitored to evaluate success?Provide a comprehensive framework for measuring outcomes that takes into account customer experience, cost, compliance, and levels of fraud.
Your company could employ a more strategic approach to onboarding new customers by taking these questions into account and implementing a layered strategy for identity verification that fosters brand loyalty and boosts revenue. At FTx Identity, we are devoted to ensuring your business is a success while keeping your customers’ information safe and secure. We take pride in providing you with the peace of mind that comes from knowing all data will be truly protected. Ready to take the next step? Give us a call today to set up a consultation and demo with one of our specialists today!