Addresses are one of the vital identification attributes to validate customers’ and their location. As retail and e-commerce industries use these details for dispatching orders to the right buyers, similarly, banks also require them to ensure customers opening an account hold legitimate identities. Otherwise, fraudsters will get their hands on someone else’s debit/credit cards, avail financial benefits, or apply for account opening.
To combat criminal activities, regulatory bodies have made verification of address a legal obligation. As a part of due diligence, banks need to validate customers’ location-related information. AI-powered solutions provide financial institutions with real-time identification and geolocation analysis that further help locate individuals. The blog sheds light on ways online address verification solutions assist banks to counter fraudulent attempts.
Challenges Associated with Bank’s Verifying an Address Process
Banks have been using manual methods to validate address of customers. However, the process is cumbersome as it takes weeks to get results. Moreover, traditional verification involves high risks of human errors and creates unnecessary friction as well as delays for clients. Banks’ account opening process largely relies on documents. Fraudsters are using various advanced tools to either camouflage or create fake ones in order to easily pass through the address verification process.
Banks require robust and automated solutions to make the document verification process of utmost security. By using OCR for data extraction, these financial institutions can mitigate inaccurate entries and chances of false positives. However, fraudsters deploy various techniques to forge documents and steer clear of the verifying address process. Later they can use the synthetic identities to launder money or avail illicit financial benefits. More of the challenges that banks face are in the next section;
More Friction During Customer Onboarding
Banks are shifting their operations online to better assist global customers and provide them with online transactions. Simultaneously, clients are expecting the systems to be easier, frictionless, and quick. This involves, instant sign-ups, user-friendly address verification, and seamless transactions.
Inefficient locating mechanisms can somewhat make this challenging for both customers and banks. Furthermore, financial institutions can face a severe backlash in accurately verifying an address leading to customer drop-off.
Complex steps, time-taking registration, and inefficient mechanisms to validate address, while result in customer aggravation. This is why banks need to integrate automated and friction-free solutions to validate users’ locations while keeping convenience intact.
Forgeries in Documents’ Templates
In order to open new accounts or approve applications for financial benefits, banks require customers to provide proof of their location. The first step in address verify process involves manually entering information into the form. In the second step, customers upload supporting government-issued documents that serve as evidence. For instance, ID cards, passports, driver’s licenses, utility bills, tenancy agreements, tax invoices, and employment letters.
Despite employing automated and robust address verification services, banks still face fraud risks. Every region has distinct template styles which makes it easier for criminals to forge documents. Moreover, presence of technologically upgraded tools such as photoshop further helps them carry out malicious activities. However, with robust and AI-powered address verification systems in place banks can efficiently validate documents, validate templates, and ultimately analyze location details.
Extra Charges for Analyzing More Documents
Along with the high risk of human errors, manual address verification also involves additional operational costs. Verifiers are incapable of handling huge data sets which slows down the process. Moreover, criminals use technologically advanced tools to forge documents which makes it more challenging for manual verifiers to identify these changes.
Banks require more efficient solutions to verify address. AI-powered services provide institutions with real-time document validation along with analysis of geo-location while consuming comparatively fewer resources.
Online Verification of Address – Defense Systems for Banks
The digital solutions help banks validate address with ease while ensuring seamless customer onboarding. Moreover, institutions can ensure active compliance with regulatory standards, authenticate documents, and analyze geolocation in real time. Ultimately, banks can fight criminals and restrict their illegitimate access to digital operations.
Where criminals are using sophisticated methods to bypass address verify checks, banks need to place restrictions on their way. By employing AI-powered top-notch services, they can validate ID documents in real time. This will not only ensure secure customer onboarding but will also address their security concerns.
Another type of authenticity check in the online address verification process is coss-matching against global registers. AI-powered services allow banks to access databases, helping them to validate information, documents, and cross-verify customers’ location.
Verifying address provides evidence regarding the location of customers which is a part of their identification process. Criminals use fake or stolen details to open new accounts, avail governmental benefits, and commit money laundering. However, with AI-powered address verification solutions in place, banks can not only secure online transactions but also provide a secure and improved experience to legit customers.