Why Should you Automate Identity and Verification for Customer Onboarding?

Posted on June 24, 2022
Written by Clare Puplett

Digital Identity and Verification

ID verification is a non-negotiable element when onboarding new customers. It’s an essential part of the Know Your Business (KYB), Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements. When done well, it supports the business in creating long-term customer loyalty with minimal inefficiencies in productivity, lower exposure to risk and faster time to revenue. The rate of automated onboarding has increased over the last two years but what are the key considerations, when weighing up the benefits of automating your processes, particularly for Identity and Verification (ID&V)?

Accelerate the Customer Journey

There was a time when visiting a branch or posting documents for verification was acceptable for onboarding. That’s no longer the case. We live in an ‘always on’ society where customers expect fast, and often immediate, responses.

A friction-free onboarding process is crucial to ensuring long-term customer satisfaction, which directly impacts the bottom-line. Automation of ID verification will help accelerate the onboarding process for businesses in any industry. Workflows can be digitised and integrated into existing systems. Latency between touchpoints is reduced to accelerate time to revenue and every touchpoint can be managed to provide an improved customer journey.

Fully automated systems incorporate the latest facial, voice, liveness and biometric processes, alongside remote document verification, to ensure both accuracy and swift responses.  

During the automated onboarding process, a customer will be asked to upload documents and/or take a ‘selfie’. The software will then automatically compare it to millions of records held within powerful databases with real-time responses provided to expedite the verification process.

With the right solution, your business can digitise the verification component of the user journey and focus human interaction at other stages of their lifecycle to build loyalty. 

Automated Identity and Verification to Scale with your Business

Manual processes aren’t suitable for scaling businesses. As soon as a customer base, or the level of complexity, increases, there comes a tipping point where manual processes become too expensive. Spreadsheets and CRM systems can only take a company so far. Once the level of data and number of customers or products hits critical mass, they become a hindrance rather than a solution.

Dealing with customer data is an extremely important part of a company’s daily processes, whether onboarding, servicing, or monitoring activity. Human resource is an expensive commodity that is not always accurate or runs 24/7.

Compliance teams have a difficult task. They are often viewed as the blockers to a company’s success as they insist on accuracy and are often process-driven – and rightly so. 

The truth of the matter is, their activities provide a hugely important safety net that ensures that a company does not fall foul of the regulators, by enabling the introduction of errors into critical processes. 

Your compliance team’s workload can be reduced significantly, alongside your sales support and servicing function, by introducing an automated identity and verification system. Not only will it significantly reduce the need for human intervention on sales, but it will also provide for an accurate onboarding, monitoring and remediation function, which are all essential when servicing and upselling.

Regulators and Automation

Love them, or loathe them, the regulators are there to deliver an important task, mainly to guard against company fraud and money laundering attempts from ‘bad actors’. The way businesses and regulators collaborate when onboarding new customers is ripe for transformation. 

It is incumbent on businesses to do everything in their power to keep pace with the new AML innovations available, to ensure that their data is as clean and accurate as possible. Failure to do so will attract interest and scrutiny from the regulators, who will not hesitate to impose fines if they deem that a company has allowed mistakes to happen, due to insufficient investment in, or attention to, compliance procedures. The most basic of which is identity and verification: if you can’t accurately and positively identify the credentials of the person you are dealing with, then you have no basis for doing business with them.

A manual documentation process is a major bottleneck that slows progress in keeping a streamlined audit trail. However, with an end-to-end automated process the regulators can be satisfied and there are better outcomes for reporting  and evaluation.

Additional Benefits of a Digital Identify and Verification Process

In addition to the key benefits described above, there are several other advantages to introducing an automated ID&V process into your onboarding system:

  • Improved Sales-to-Revenue time: By shortening the time between an enquiry to ultimate purchase, by significantly reducing the time taken to accurately identify the applicant, revenue streams can be achieved much quicker. This reduces your cost-per-sale and enables your teams to concentrate on the next opportunity, increasing the number of sales that can be achieved in the same timescale
  • Stay ahead of the competition: With more and more companies introducing automated systems for onboarding, companies who still rely on manual or part-automated processes will eventually fall behind. It’s a very competitive market out there and any edge that you can gain, whether by innovating to stay ahead of the market, or by introducing automation to keep up with the competition, will improve your business’ chances of competing in or leading the market
  • Staff morale: Providing an environment in which your staff can both enjoy their work and see how that work is contributing to the success of the company, is a great way to boost morale. And there is plenty of clear evidence to suggest that a content and engaged workforce works much more efficiently, further boosting the effectiveness of what they are being asked to do. Automating systems that have become a burden to staff, to the extent, perhaps, where they no longer enjoy their job, or, worse, see little point in it, can be very detrimental to morale, fuelling dissent, increasing staff turnover and reducing the whole company’s effectiveness

Traditional methods of ID verification are no longer sufficient if businesses want to achieve regulatory compliance whilst they scale and grow. The rise of international terrorist financing and increasingly sophisticated schemes such as synthetic identity theft have necessitated more advanced methods of ID verification. It is no longer enough to simply compare a person’s ID to public records because ID can be stolen or forged.

The next generation of ID verification technology relies on facial recognition, but with a twist. To determine the authenticity of a person’s claimed identity, it requires the customer to provide two images: a form of photo ID, and a selfie taken in live mode.  

This requires automation so the quicker businesses adapt the better!