Financial institutions face constant pressure to comply with regulatory mandates designed to stop identity fraud and money laundering while still delivering excellent customer support, watching bottom-line results, and meeting business objectives. In today’s complex business environment, this appears like an almost impossible task. However, those regulatory mandates also create many opportunities to improve efficiencies and save money. By integrating identity verification into the overall risk management strategy, financial institutions can get to see substantial benefits to their bottom lines, customer support levels, and employee productivity.
For today’s financial institution, identity verification is a critical facet of establishing a new relationship. True identity verification means reviewing the truthfulness of just what a prospective customer discloses by screening the info against multiple sources, then analyzing the reality to determine whether a new relationship must certanly be started. “Know your customer” has always been promoted within institutions as a sign of personalized customer support; however, with the enactment of the USA PATRIOT Act regulations, identity verification is now the difference between success and failure in the ever-changing financial services market.
Why is identity verification crucial that you financial institutions?
The increased role of the country’s financial institutions in securing the house front mustn’t be undervalued. The reason behind the USA PATRIOT Act is national security. No body will disagree that having a much better understanding of the client conducting business at a company provides increased security for the institution, its customers and people in general.
The danger for banks is more than simply monetary loss. 먹튀 Injury to an economic institution’s reputation created by noncompliance and the publicity surrounding terrorists opening accounts can result in lost confidence in the institution and significant lack of customers, sales, and revenue. Recovering from negative publicity is a long, difficult, costly process.
Institutions need to stop identity fraud while balancing the necessity to protect customer information with a customer’s requirement for quick, efficient service. Identity verification is clearly a first faltering step in reducing the opportunities for fraud and taking action. Stopping the “bad guys” from opening a new account at a company is the simplest and most cost-effective way to lessen a bank’s burden. That’s how “knowing your customer” can help–if identity verification becomes the main defensive measures within the overall risk strategy, it can be quite a significant aspect in preventing fraud.
Increasing Operational Efficiencies
The USA PATRIOT Act has driven financial institutions to review corporate policies and perform lengthy risk analyses. Identity verification technology helps integrate policies into normal routines by allowing frontline workers to gather needed information rapidly and efficiently instead of manually researching identity information by calling references and checking websites.
From airline travel to school registration to doctor visits, society is accustomed to trading some privacy for the security of every individual and the country. However, customers do expect their financial institutions to guard their identity information and their fiscal assets. Identity verification programs allow new accounts to be opened quickly, creating a positive experience for the consumer while showcasing the methodology the institution has in position to guard its customers.
Determine perhaps the customers appear on any list of suspected terrorists or terrorist organizations(2)
There are many options available to greatly help banks implement identity verification programs to comply with the regulations, always aiming to make educated and proactive decisions about customers. The USA PATRIOT Act regulations allow a documentary or nondocumentary approach.
Documentary Solution
Traditionally, the usage of manual or documentary solutions for identity verification has been prevalent in the financial services community. At many institutions, an employee will look at a driver’s license or passport to begin account-opening procedures. Institutions are counting on driver’s licenses and passports to be valid, but with the recent increase in forgery, it is difficult to possess confidence that the documentation is legitimate.
Nondocumentary Solution
Because the enactment of the USA PATRIOT Act, technology has improved within the area of identity verification. Identity verification technology supplies a simple way of integrating a CIP into an institution’s risk management strategy. In addition, identity verification technology gives a company a cost-effective tactic for keeping up-to-date with ever-changing regulations.
For true identity verification, it is critical to screen presented data against multiple independent sources to make certain consistency. Checking one source will not provide enough information, and there’s no database which includes everyone residing in the United States. This implies a company must concur that the name, Social Security number, address, and date of birth are valid and associated together using various data sources. If the data is unvarying throughout multiple sources, the institution could make an educated decision that it is truthful. By using identity verification technology, organizations might have the various tools, not merely to verify identity, but also to screen against government lists and document transactions. Institutions can completely comply with the regulations, while also realizing the benefits of protecting against fraud, increasing operational efficiency, and improving customer support levels.
