AI Removes Friction From Challenger Bank Onboarding

AI Removes Friction From Challenger Bank Onboarding

May 25, 2021 at 09:02AM

Know your customer (KYC) procedures has never been more important as the pandemic has caused a surge in digital transactions.

While customers want bank and retail websites to keep their personal data secure, they don’t want to have to jump through hoops to confirm their identity. Potential customers frustrated by an intense onboarding experience have been known to abandon their online application, costing lenders cash and clients.

Artificial intelligence (AI) and machine learning (ML) have emerged as the most promising ways to combat financial fraud. These tools can help detect suspicious behavior to prevent data breaches and fraud before cash is drained from accounts and banks face a tarnished reputation.

The May Digital Identity Tracker® explores how biometrics, behavioral analytics and IP address verification can help confirm user identities, reduce onboarding friction and prevent fraud.

Around The Digital Identity World

The pandemic has accelerated the move to digital and caused a boom in the adoption of biometrics, according to a survey. It found 62 percent of respondents said their company has prioritized technology to support remote onboarding and authentication due to the pandemic. As a result, 45 percent said the use of biometrics has increased. Every respondent agreed customer experience is important to their company while 73 percent said biometrics can help. Of the 55 percent of those polled who told researchers their firm uses biometrics, 75 percent use it for identity verification, 69 percent for authentication, and 31 percent for fraud detection.

Jumio has joined Microsoft to launch Azure Active Directory (Active AD) verifiable credentials designed to enable faster onboarding, the company said. The initiative is an AI-powered tool that offers identity verification providers a way to share better verifiable data. It allows companies to confirm user information and protect privacy by not storing the data. The credentials can confirm education or personal certifications. Microsoft said by collaborating with Jumio, the two companies can assist organizations to verify customer information such as ID documents and electronic data, while also providing consumers with control over who can access the information.

Nearly two-thirds of consumers rely on their memory to recall passwords, while 25 percent establish new login credentials weekly because they’ve been forgotten, according to a survey. One-third of Americans are the most likely to report a data breach versus 25 percent of global respondents. Additionally, one-third of Americans prefer easy-to-recall passwords over more secure ones. Security experts may suggest long, unique passwords, but 90 percent of Americans said they use the same password across many sites.

For more on these and other digital identity news, download this month’s Tracker.

Douugh On Using AI To Power Smooth Onboarding, Verification For Digital-First Customers 

As digital banking, online shopping and contactless payments took off last year, the focus on online security became even more intense. Since the start of the pandemic, consumers have expressed a preference for invisible methods of security, such as those that are physical and behavior-based, without the need to verify their identity in person.

In this month’s Feature Story, Andy Taylor, CEO of neobank Douugh, explains how the company is able to onboard customers digitally in three minutes.

To get the full story, download the Tracker.

Deep Dive: Simplifying ID Verification With Physical And Behavior-Based Tools

For the first time in five years, one survey found that passwords failed to rank among the chief ways to confirm a customer’s identity. Instead, the report noted the top three methods for authentication include physical biometrics, such as fingerprints and facial recognition, pin codes texted to smart phones and behavioral analytics that do not require any consumer effort.

This month’s Deep Dive provides an in-depth examination of how biometrics, behavioral analytics and IP address verification can help seamlessly confirm user identities, reduce onboarding friction and prevent fraud.

Read the full Deep Dive in the Tracker.

About The Tracker

The monthly Digital Identity Tracker®, a Jumio collaboration, offers coverage of the most recent news and trends in the digital ID ecosystem.