Identity theft is on the rise. With technological developments increasing day-by-day, there has been an alarming increase in the instances of fraud and scams online. Security has become a major concern for individuals and many businesses nowadays. Identity verification is increasingly becoming an essential component of Know Your Customer (KYC) regulations. Because of its importance, ID verification has been around for hundreds of years. However, with time, it has evolved and become more secure. Initially, when one ID verification method became less secure, it was replaced with something better. Identity verification was previously used only in the financial sector but it has slowly paved its way into many other industries now.
To login to your online account, you had to enter your childhood school name or your pet’s name to verify your identity. This method, called Knowledge-Based authentication, is now considered old-fashioned and vulnerable to threats from modern-day fraudsters. Due to the evolution of the dark web and cybercrime, the traditional forms of authentication are no longer effective. Although the modern methods of identity verification are considered to be more accurate and safe, fraudsters consistently come up with newer ways to by-pass the security barriers set by the regulatory bodies.
Data breaches are a common phenomenon and are one of the leading causes of identity theft. Massive data breaches have wasted millions of sets of personal data which included: names, usernames, passwords, telephone numbers, dates of birth and security answers. A recent data breach took place at Fortnight, a popular online video game. The game has 200 million users worldwide with 80 million active users on a monthly basis. Based on these numbers we can predict the intensity of the loss.
Traditional Identity Verification
Almost all of the traditional methods of identity verification are risky and provide potential loopholes to fraudsters and scammers. This is why it is important to constantly monitor the strength of each method. Some of the traditional identity verification methods that are ineffective now are described below:
These are troublesome because passwords are tough to remember and are sometimes easy to guess by hackers as well. They are generally regarded as inherently insecure.
- SMS-based 2 Factor Authentication
This is a common form of authentication but the SMS codes are sometimes easily intercepted by hackers through phishing attacks.
- Token-based Authentication
This method of authentication has its drawbacks as well. The token used for authentication must be carried at all times and is non-transferable. There are also chances of tokens being stolen or misplaced,
Although biometrics are more secure as compared to the other traditional identity verification techniques, they are still vulnerable to attacks from innovative hackers and fraudsters.
Modern Identity Verification
It might be dusk for many of the traditional identity verification techniques, but it marks the beginning of a new dawn for modern and innovative identity verification techniques. Modern tech companies are persistently trying to come up with new inventions to automate existing identity verification solutions. Many have adopted the cutting-edge Artificial Intelligence and video selfie technology to link the identity of the user with the associated account. This technology is quick, reliable and secure, and has barred the hackers from gaining access to the system.
This online identity verification solution would allow you to confirm your identity in a wide range of scenarios; from checking in to a hotel room you have booked earlier or unlocked the doors of a car you just rented. All of this using just your selfie. It might even eliminate the need for a password altogether. The whole process will take only a few seconds to complete and will require nothing more than a webcam or smartphone.
There are many ways AI is used to verify identity. Some of them are listed below:
The use of artificial intelligence systems to detect facial features for verification purposes.
The use of artificial intelligence systems to detect the authenticity of various documents to manage fraud.
The use of artificial intelligence technology to verify addresses from the documents to minimize the threat of fraudsters.
The use of multi-step verification to enhance the protection of your accounts by adding another security layer, usually involving your mobile phone.
The use of handwritten user consent to onboard only legitimate customers.
Keep in mind that a silver bullet for fraud prevention doesn’t exist. It takes ongoing research and innovation to secure your systems and accounts. Together these techniques and attributes, when organized and invoked, can help create a new frontier of authentication and identity management. Scammers and hackers are quick to evolve, therefore businesses and individuals need to stay a step ahead to stay safe and secure.
Author- Liam Smith
