Conversion rates are crucial for financial institutions. Having an onboarding process that maximizes this is increasingly important in a digitized world. Getting the balance right between security and customer experience, however, is essential.

A recent webinar from IDnow looked at this concept. Having the right level of friction in your solutions is vital in achieving the best possible conversion rates while also keeping fraudsters at bay and avoiding fines from regulators.

IDnow’s products are designed with this in mind. The company offers a full set of solutions to efficiently onboard users and to combat fraud. These are delivered through a common platform, with a well-developed focus on the user experience.

The digital onboarding process in banking

Digital onboarding has become much more important in banking over the past years. The number of adults accessing finances online increased from 35% to 69% over the 10 years to 2018. This has only increased further due to the COVID-19 pandemic. A recent study by consultancy McKinsey suggested that the pandemic has pushed us seven years ahead in digital transformation.

This increase brings challenges with it. Customers expect to be verified and accepted quickly, with a streamlined and bug-free onboarding process. At the same time, it is increasingly important to carry out security and identity checks to meet updated regulations and protect against rising levels of fraud and financial crime.

Many financial institutions in Europe and the UK are struggling with this. Onboarding and KYC processes are often old and inefficient, perhaps having evolved from previous manual processes. A refresh of these can offer better security as well as an improved customer experience.

IDnow’s identity verification solution is designed to prevent fraud

A well-designed and feature-rich solution is needed to meet this balance between security and user friction. IDnow’s AI-powered solution AutoIdent aims to offer just this.

AutoIdent developed from earlier methods of video-based identification (see IDnow VideoIdent) to offer an automated AI-based verification solution. This will carry out a series of automated checks on users’ identity documents and appearance via a biometric selfie. Differently from other vendors, our platform is a natively video-based solution and never relies on a static picture alone. We extract hundreds of frames on both document and biometric verification.

It also offers a hybrid approach with the backup of manual verification. If the AI is not confident on a particular case, or the user is waiting too long for results, it can fall back to a manual verification where an agent will decide if it`s a pass or fraud. The same checks can then be carried out this way, without further inconvenience to the user. These can be handled by IDnow specialists or routed to our clients` internal staff.

A combined approach like this ensures the highest security for identity verification and causes the least hassle for the user.

Identity verification is not enough on its own in many cases – including areas of financial services. IDnow’s single platform also has other anti-fraud solutions built in. This includes document hologram checking capabilities, NFC verification and video liveness detection.

Solutions comply with the latest regulations

KYC and AML are highly regulated areas. Such regulation has increased over the past decades to keep pace with the changes in financial crime and terrorism.

IDnow’s solutions are fully compliant with European and UK regulations. One single platform that complies with regulations in the UK and across Europe is increasingly valuable since Brexit. Solutions meet the latest 6AMLD regulations and fully conform with European eIDAS standards for Qualified Electronic Signatures. IDnow offers full AML screening (PEPs, Sanctions, Adverse Media checking, Watch-list, etc.) together with on-going monitoring for a compliant KYC process in multiple jurisdictions.

Read on: ID Verification with AutoIdent – meeting European regulations

Verification with the most advanced technologies – and this continues to develop

AI-based verification makes the process straightforward and seamless for the user, but with plenty of advanced methods in use.

IDnow’s AI and machine learning-based system runs various text and visual checks on documents. This includes automated hologram protection by checking reflections at different angles of the identity document, and video and biometric check ownership of identities. These are well-developed solutions able to combat known fraud techniques, such as look-alike images or the use of silicone masks.

NFC functionality has been added recently. This is currently used to read German identity cards, but the solution can be easily expanded as it fully meets the global ICAO 9303 standard.

These technologies meet top security regulations. Image and video likeness technologies, for example, meet the highest NIST standards for anti-spoofing.

Ensuring the best user experience

Security is vital, but to get top conversion rates, you need to focus as well on the customer experience. If onboarding takes too long or the experience is not a good one, you risk losing customers.

Reducing friction points and understanding exactly what users are prepared to deal with is a key part of this. Onboarding is possibly the users’ first experience of your brand, and it should feel seamless and straightforward.

There is more to the user experience than just speed and branding, though. Customers want to feel safe and have a verification process that completes accurately and automatically. IDnow’s products have been developed with extensive feedback collected from end-users incorporated into the processes to make them as intuitive as possible.

AutoIdent provides users with real-time feedback during the verification process. Users are guided through overcoming issues that are impacting verification. This could be things such as document position or lighting conditions.

Fallback methods also help the user experience and conversion rates. If the AI does not succeed, users can be verified via an agent. Companies that only offer an AI-based solution will struggle to retain customers when verification fails, or users need more support. Bear in mind that not all users are fully tech-savvy!

Read more on: Why offering multiple identity verification options can become a competitive advantage

In Conclusion – get the balance between security and user experience right

Advanced security features and methods, regulation compliance, and a seamless customer experience come together in creating a great onboarding and identity verification solution. Getting the balance right is essential in achieving the best possible customer conversion rates.

I believe that IDnow has developed a solution that gets this balance between security and user friction right. In doing so, it helps businesses boost their conversion rates while also meeting regulations and protecting them from financial crime.

You can find out more by viewing our full webinar. This looks in more detail at the journey of identity verification to today’s solutions and the important balance achieved. It also shows the AutoIdent platform in action and discusses some examples of its implementation.