Identity Verification for Fintech Industry

Fighting Fintech Fraud with ID Verification

The impact of crime has a ripple effect: adversely affecting brand image, denting consumer trust and investor confidence, or causing losses with hefty lawsuits. Digital transformation and the trend towards mobile usage have shaped FinTech, an industry integrating finance and technology for a global, frictionless ecosystem of trading, banking, financial products, and services. Digitization of financial services has replaced the customer-facing business model with an applications-based mobile-driven interface.

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Identity verification for Fintech

Stolen identities and falsified data

Cybercrime takes a toll on the FinTech market which is heavily exploited by fraudsters. Very often, the need to reduce customer attrition compels FinTech businesses to compromise on customer authentication. This makes it easy for fraudsters to falsify information, make use of stolen identities, or use the network for money laundering.

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Cybercrime on the rise

Before the pandemic, the global FinTech market was expected to grow by 22.17%, and indeed, the industry expanded phenomenally across a range of financial services. That’s why FinTech revolutionized many business verticals like banking and e-commerce, with products and services designed to offer seamless and unique customer experiences. At the same time, cybercrime and fraud rose as well, giving a hard time to the FinTech players.

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ID verification to prevent payment fraud for Fintech
money laundering at Fintech

Money laundering activities

Laundering cash proceeds from unlawful activities like gambling, sale of drugs or arms, bribes, crime, invoicing malpractices remains the core issue. Using the automated systems of FinTech, money can be sanitized or laundered through a complex set of transactions: using a shell firm for illegal parking offshore, splitting cash into small amounts for micro transfers which do not require ownership information, over or under-invoicing for trade-based transactions, purchasing high-value assets like luxury cars and real estate for re-sale, and so on.

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