“The bank is sealed due to involvement in money laundering”, “Two more victims of credit card fraud”, “The criminal used to carry out fraud of million-dollars by taking others identity” These are the headlines that we happen to go through every day on news channels and social media. Why such cases are increasing with every passing day? Have businesses failed to provide security to their customers? Yes, it can be one of the reasons.
Traditional Security Practice:
With the advent of technology, cybercriminals and fraudsters have become more sophisticated and talented that has resulted in an increased ratio of online fraud and crimes. Traditional security practices are now failing to prevent fraudsters from breaking into the system and committing fraudulent activities.
Most businesses still rely on password level protection which is no more difficult for a hacker to get through phishing emails, and spamming pages, etc. a lot of people get their credentials stolen. Anyone having those login credentials can easily enter the system and carry out their activities. This concern has made the companies look into advanced technologies; AI-based KYC services are the ones for this purpose.
The need for KYC solutions in different Industries:
Know your customer-KYC solutions are becoming essential for all online marketplaces to prevent identity theft, online fraud, and other money laundering activities. With the involvement of government and regulatory agencies, it is necessary for the organizations to abide by the compliance rules to ensure the security of the customers. Let’s see, which industries are reliant on KYC products.
As the world is moving towards digitalization, now banks allow their customers to open an account online. The challenging part here is to verify the identities against the applicants and to ensure that they have not been alleged of any financial crime. This not helps the system in preventing the customers from identity theft and fraud but also doesn’t allow the money launderers to do any transactions. Without relying on the KYC process, financial industries may have to suffer greatly.
The e-commerce industry is one of the fastest-growing industries in the world; and is on target of fraudsters and criminals. Online shopping presents a huge fraud risk of about 81%, and in 2017 6.64% of consumers became the victim of identity fraud. The hackers can easily steal credentials from authentic users through phishing emails and other spamming tactics and use them later on for their benefits. With the use of the KYC services e.g. address verification, ID verification, face verification, and document verification, etc. the e-commerce businesses can prevent the various online frauds.
Cryptocurrency or digital currency is the fastest-growing technology these days, but with the decentralized peer to peer approach of anonymity, it has proved to be heaven for cybercriminals and money launderers. But the increased rate of e-Currency fraud, the government agencies got involved making it must for the organizations to obliged by the KYC compliance of their end-users.
The online gaming industry is attracting the attention of teenagers these days. Some games require a certain age limit of its players. The gaming industry is fully regulated to prevent minors from gambling and participating in other adult games. With the help of KYC age verification services, the sites would know if to allow access to customers or not.
KYC is itself a huge industry that is helping the online marketplaces in fraud prevention and identity theft in one way or another. No doubt, security concerns are always going to be there in the market but with the rapid advancements in KYC services, committing online crimes will become impossible in the near future.