In today's digital world, verifying a user's real identity is crucial, not just when they first sign up but throughout their entire interaction with a service. With the rise of more complex threats using advanced technologies like automation and AI, businesses are finding it increasingly difficult to continuously confirm the authenticity of user identities. This situation highlights the need for more advanced methods to ensure identity security at all times, not just at the start.
KYC (Know Your Customer) is a process businesses use to identify their clients and prevent financial crimes. It involves verifying personal identification documents when a customer first registers. Though crucial, KYC is just the beginning of a comprehensive approach to maintaining identity security.
After the KYC process, identity fraud and account takeovers do not simply disappear. It's essential to keep verifying a user's identity as they use a service, to protect against sophisticated cyber threats that might not be caught by initial KYC checks. Ongoing identity verification is vital for security and trust, making sure users are who they say they are at every stage of their journey.
We’ve identified five key considerations we believe all businesses should keep top of mind when implementing ongoing identity verification checks.
The process should smoothly transition from the initial identity verification done during onboarding. Using the biometric data captured at the onboarding step for continuous authentication is the most seamless and user friendly way to continually verify someone’s identity.
The system should be able to dynamically verify users at key interaction points — such as logging in, making high-value transactions, recovering accounts, or changing account details.
Combining multiple security layers, such as facial recognition that respects privacy, device verification, and liveness detection, can greatly enhance protection against unauthorized access.
Regularly comparing biometric templates ensures that the person interacting is the same as the one registered initially. But this must be done in a way that protects their privacy by not putting their PII at risk.
The system should help businesses adhere to the latest regulatory requirements related to data privacy and security. Within Europe, the GDPR puts several restrictions on biometric data - any data that leaves the device should not contain PII. The upcoming PSD3 will put further requirements on implementing Strong Customer Authentication (SCA) for digital payments.
As digital threats become more advanced, businesses must enhance their identity verification methods beyond just the first KYC steps. This involves implementing innovative strategies to reinforce identity security throughout the customer's entire relationship with the business. By doing so, companies can better defend against cyber threats, meet regulatory requirements, and provide a secure and smooth experience for users.