Many businesses overlook it, but data security is directly associated with user experience. Good user experience is an essential aspect of a business’s success. No matter what online business you’re into, until your customers feel confident that you can handle their digital identity or data, they won’t buy your services or products.
Know Your Customer (KYC), now digitized as eKYC, is a security practice found across all industries and sectors. Its digitization has opened up opportunities for new business models and paved the way for creating novel use cases that were previously impossible.
This post will discuss the role of user experience in a business’s success and how identity verification plays a vital role in improving user experience.
So, without further ado, let’s get started.
Why User Experience is Important for Building Customer Relationship
In today’s competitive era, customers have countless options to choose from. If your service is not up to the mark, they can jump immediately to your competitor to get a better user experience. So, if you want to retain your customers, you must pay attention to your customers’ data security.
When it comes to making a purchase, 64% of people find customer experience more important than price. Another report reveals that companies lose $62 billion every year due to poor customer service.
It simply explains that providing a good user experience is no longer an added service but a necessity.
Role of Digital Identity in Improving User Experience
There are plenty of things that contribute to a good user experience. Everything plays a vital role in improving the overall user experience, from optimizing a website to improving customer service to improving the buying process. However, one crucial thing that is equally important is data security. The majority of startups and small businesses don’t pay adequate attention to the safety of their customers’ digital identities, resulting in data breaches.
According to a report published in Forbes, there have been 300 data breaches over the past ten years in the United States involving the theft of 100,000 or more records.
In an article, Security Magazine reported that consumers are abandoning brands after data breaches. The article further mentions that around 78% of customers stop engaging with brands that experience data breaches.
How Automated KYC Solutions Enhance Customer Experience
The latest KYC tools have significantly boosted conversion rates, leveraging best practices in user experience and modern interface design tailored to digital identities. That’s why the onboarding user experience is influenced by several factors:
- Minimal information requirements. You can combine document verification and data extraction to reduce user input, requiring confirmation rather than manual entry.
- Intelligent recognition algorithm. Users no longer need to select a specific document; advanced systems can recognize any document type without prior user input.
- Guidance through the whole verification process. Providing user-friendly guidance with clear explanations ensures a smooth conversion process for individuals of varying characteristics.
- Easy accessibility. Enabling users to complete the process from any device, location, or time and allowing seamless transitions between devices through a simple link is essential.
Digital identity is essential to make your customers realize that you’re committed to their data security. When you invest in a robust identity verification solution, you minimize the risk of money laundering, financial scams, and identity theft and make the onboarding journey smooth.
Let’s take a look at the different stages of digital identity and how it benefits business.
Different Stages of Customer Identity Verification
Since almost every business operation is performed digitally nowadays, the risks of identity fraud have increased at every step of a customer’s journey. Today, we can’t limit identity verification to the time of onboarding only.
KYC processes are executed almost instantly, facilitated by their cloud-based operation and real-time implementation. Specialized companies focus on streaming video identification, incorporating active and passive controls, and utilizing various biometrics such as face and voice recognition. These companies now play a pivotal role as technology providers for major consulting firms involved in designing digitization processes for high-volume multinational corporations.
Additionally, they function as direct sellers of onboarding systems and comprehensive platforms, distributing them in Software as a Service (SaaS) or Platform as a Service (PaaS) formats. As a result, we at iDenfy provide real-time identity verification solutions that help businesses cover all the customer identity stages and improve user experience.
Let’s get to know these stages in detail.
Customer Onboarding
Customer onboarding describes the process of how a customer goes through when they begin their journey as a customer of a product or service.
In 2018, over $24.2 billion was lost worldwide due to payment card fraud. The number is frightening, and the worst is yet to come. According to forecasts, card fraud will accumulate another $10 billion in losses in just 3 years.
So you can realize how important smooth onboarding is in today’s scenario. As iDenfy, we combine face recognition, liveness detection, and ID verification, and we can run various checks to identify whether the user is legitimate or not. We employ AI-enabled OCR technology that makes the verification process quick and frictionless. It reduces the requirement of human interaction to a great extent and ensures seamless onboarding for customers.
Ensure your customers are real. Schedule a free demo here.
Customer Verification
As per the law, online businesses need to employ KYC measures to understand their customers better. Generally, the KYC process involves verifying government-issued ID cards, face verification, and other relevant verification of a customer’s identity.
We help you meet KYC and Anti-Money Laundering (AML) compliance regulations. AI-enabled ID verification solution that includes a face recognition feature can recognize facial biometrics over 160 different points.
We go one step further to help businesses comply with KYC and AML directives. We can check government and Interpol data to ensure the legitimacy of a person. During the AML screening process, we check for the following databases:
- Sanctions EU, UN, HM Treasury and other sanctions databases,
- Politically exposed person list,
- Financial crime,
- Lost and stolen documents.
Customer Authentication
Even if you have onboarded a customer, you must make sure that only an authorized person is accessing your service. In the modern time, when cybercriminals are getting technologically advanced, you can’t rely on login and password security only.
To ensure your customers’ authenticity, you must have a reliable face verification system that can quickly authenticate customers before letting them access your services.
Related: Face Authentication — Why It Completes Your Identity Verification
Final Thoughts
Regardless of what business you’re into, customers are the backbone of your business. No matter how good your product or service is, if you cannot provide your customers with a good experience, you can’t expect them to visit your online store.
As a result, you must provide them with the best user experience throughout their onboarding journey and afterward. Implementing identity verification can be one good step to improve the overall user experience.
If you need help improving the user experience through automated compliance tools, feel free to book a free demo and see our RegTech solutions in action.
This blog post was updated on the 28th of November, 2023, to reflect the latest insights.
