Online identity verification methods are increasingly difficult to automate as banks and fintechs try to balance regulatory compliance and fraud prevention measures with user experience:
On the one hand, strict Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations require more internal time and resources in order to achieve satisfactory compliance.
Meanwhile, fraud rates are continuing to increase as fraud tactics become more and more sophisticated.
At the same time, customer expectations are higher than ever, and achieving a frictionless onboarding experience is of the utmost importance when you want to grow and scale your business.
Also, incorporating more robust real-time identity verification checks into legacy systems can be a lengthy, expensive process — when what you really need is speed and agility.
Before you can seamlessly automate ID verification, there are often significant obstacles in the way that you need to overcome.
An Identity Risk Solution, like Alloy, is a complete end-to-end platform for managing identity, fraud, credit, and compliance risks throughout the entire customer lifecycle. Alloy helps you:
Establish real-time digital identity verification
Trigger automated step-up verifications as needed
Determine a customer’s risk level at origination
Automate and customize KYC, KYB, AML, and fraud checks
You will be able to confidently onboard more good customers, without adding unnecessary friction to the workflow or increasing manual reviews for your team — no coding or additional engineering resources required. Alloy also allows you to set the cadence of periodic ID verification checks, so you get compliant and stay compliant with AML and sanctions screening obligations.
Ultimately, the key to streamlining digital ID verification is data orchestration.
Alloy has pre-built integrations to 190+ data sources that you can customize to reduce the manual tasks associated with customer verification. Then, Alloy uses data orchestration to effectively integrate, process, analyze, and create a layered framework of data from all your chosen sources for a unified view of your customers’ behavior and the associated risks. As a result, you can accelerate application processing times.
Why is data orchestration so critical to the success of banks and fintechs?
Learn how the leading banks and fintechs are verifying thin-file applicants
Automated document verification can be a key component of verifying identity. With Alloy, the validity of documents — such as ID cards, passports, or driver's licenses — are checked against multiple data sources to ensure the document’s legitimacy. Customers are spared the experience of uploading documents multiple times, physically mailing documents, or presenting them in person to confirm their identities. This expedites the onboarding process, enhances accuracy, and contributes to a seamless onboarding process.
When automated document verification is included in your workflow, you can onboard customers at a faster rate and increase your chances of spotting fraudulent activity at origination.
Can you use step-up verifications without disrupting the customer experience? (Yes.)
How to adopt a perpetual KYC mindset when it comes to reverifying existing customers
Most banks and fintechs put transactions at the heart of their fraud prevention strategies. They look for atypical transactions and respond accordingly. However, only 50% of banks believe their organization is effective at managing identity decisions, even though they want to prioritize digital ID verification and address this challenge.
At Alloy, we believe that all fraud is identity fraud. When you focus on real-time identity verification, you can be proactive, as opposed to reactive. It’s much easier to stop fraud when you can spot a fraudster’s false identity during onboarding than when they have been approved and are in your system, ready to wreak havoc.
It’s not just about the customer who initially looks good on paper. You need to dig deeper and weigh the risk of whether they are likely to commit fraud in the future. Strong digital identity verification processes can help you pinpoint those instances during the onboarding process — before any fraudulent behavior occurs.
Banks need to step up their customer verification processes and meet consumer expectations — even as fraudsters become more sophisticated. But, if you are restricted by the limitations of your legacy digital verification systems, how can you speed up onboarding processes? It might be time to consider outsourcing the solution to a third party.
Get a copy of Alloy’s ultimate build vs. buy guide for banks
Novo is an online banking platform for small business owners. As a startup, they needed the ability to quickly and securely onboard more customers, while creating better operational efficiency. Through a single integration with Alloy, Novo was able to access all the necessary data sources for their digital identity verification processes — without losing hundreds of developer hours.
With Alloy, Novo has achieved the following:
50% reduction in manual reviews
68% of applications go through an automated decisioning process
10 minutes (or less) required for new account openings
You want to automate digital identity verification and comply with stringent regulatory requirements — while you safeguard against evolving fraud threats. And you need to do it quickly, with operational efficiency. It’s a daunting task, but outsourcing just might be the perfect solution.
Brex is a B2B financial provider that offers corporate credit cards with high spending power to startups and enterprise companies. As they were gearing up to launch their first card, Brex chose Alloy to stand up their KYC/AML processes and create a more efficient onboarding flow.
With Alloy, Brex has:
Automated 80%+ of new account openings
Required manual reviews for less than 2% of card applications
Served 1000s of customers
Alloy works with the most trusted global technology and data providers to help our clients access the resources they need.
