Phone Verification

Phone verification works by confirming the ownership of the phone number by sending an SMS or calling the phone number and receiving a response. It’s called a verification process because it can be used as a low-friction onboarding measure or a reverification step before more risky situations, such as before the customer makes a large purchase or hasn’t logged into their account for a long time.

A one-time password (OTP) is a generated code that is used for a single login session. In the context of phone verification, when a company needs to verify a client’s phone number, it sends a one-time password (OTP) via SMS or a “text-to-speech” message if SMS is unavailable. The user is then asked to enter the OTP to complete their verification.

A proper phone verification service should evaluate and tell more about several risk factors, such as: 

• Whether the number is listed on any blocklists.
• When the phone number was created. 
• Whether the phone number has been switched to a new carrier.
• If the phone number’s area code matches the user’s current address.
• Any other suspicious factors, such as multiple people linked to the same phone number.

High-risk industries, such as fintech or banking, often use other verification methods next to phone verification, for example, such as selfie verification or manual reviews for high-risk customers.

One of the most important benefits of this verification process is its ability to provide a near-perfect user experience, especially since a lot of users are already familiar with phone verification checks. Sometimes, platforms use this security feature also as another channel to set out payment reminders or reach out to their users.

An Application Programming Interface (API) call is able to analyze the phone number while gathering the key information about it. Businesses use this measure to both detect and prevent fraud. For example, this quick API call can tell the phone number’s risk score, roaming status, current route, validity, area code, roaming network name, etc. 

Decide whether you want to give users the option to be contacted by call or SMS for the phone verification process, as many vendors provide various phone verification methods. Check if the service provider offers easy integration options with your existing systems. If you operate in a high-risk industry, you should consider a RegTech service provider that offers multiple fraud prevention measures, including manual verification for high-risk clients, to ensure complete compliance.