During the customer on-boarding process, document verification verifies the authenticity of documents to enhance the customer experience and prevent fraud.
The document verification process is used to verify the legitimacy of documents. Neglecting the process may result in financial crimes, put the business in danger, and result in identity theft. Companies that don’t correctly comply with the regulations may face heavy penalties and jail time. Before digital advancement, businesses verified customers through a manual process that required their physical presence. Government-issued documents like licenses, CNIC and others are considered the most reliable papers. They have unique attributes like watermarks, MRZ codes, stamps, signatures, and typefaces. The document verification process checks these unique attributes to confirm whether the document is original.
Difference Between Document Verification And Identity Verification
Document verification is an extension of identity verification. In this, a client is asked to submit the documents, such as license, passport, etc., by taking pictures and uploading them on the website. The company’s compliance system verifies the documents by extracting and matching data and verifying whether they are genuine or forged. In case of any discrepancies in the data, the application will be rejected and not proceed further.
Identity verification is the extended term by which the identity of the person who owns the documents is verified. It verifies that whoever uploaded the documents actually has them or unlawfully obtained the images from somewhere else. In identity verification, PEP (politically exposed persons), addresses, and past records are screened. This process involves biometric checks that verify whether the customer’s provided data matches the document data. Businesses require identity checks because document verifications are insufficient to prevent fraud.
How Does the Document Verification Process Works?
The document verification process is carried out at the beginning of the on-boarding process. There are two types of document verification; traditional document verification process and online document verification process.
During in-person verification, a customer presents the documents. The specialist verifies them with full attention and matches the data with a referenced database. The process itself is time-consuming and hectic.
In digital document verification, the customer is asked to upload pictures of documents and a selfie. The company’s KYC and automated software verifies the documents using AI and machine learning without human interference. It ensures the authenticity of documents, whether they are real or fake. Optical character recognition (OCR) matches the data from documents with the referenced database. Machine learning speeds up the process from days to minutes.
The digital identity verification process can be carried out in the following three ways:
Photo Based Identity Verification
In the onboarding process, a customer is asked to take a photo of documents and a selfie.
Video-Based Identity Verification
In this case, verification is done by setting up a video call between the customer and the KYC specialist.
Manual Identity Verification
Clients can submit their document copies in hard copy for verification, and this verification method is mainly used for address verification.
Benefits Of Online Document Verification Process
The importance of the kyc document verification process can’t be underrated. The document verification process has many benefits, as stated below.
Prevent Identity Fraud
Verifying the identity of the person who owns the documents reduces identity theft. When someone tries to access the account, the system asks them for proof of their identity. If a person cannot enter the details to log in to the account, the system raises a red flag.
Remote onboarding can only occur when businesses implement all the safety precautions/measures. Document verification is the best way to safeguard businesses from fraudsters, illegitimate customers, and financial crimes.
Reduce Inaccuracies And Save Time
Traditional document verification requires human involvement and is prone to errors. By using digital document verification, these errors can be reduced, saving time and resources for the company by using advanced and automated technologies.
Meet Legal Requirements
Verifying the legality of documents is necessary, depending on the sector in which the business works. Compliance with regulatory requirements is provided via the document verification procedure.
Build Customer Trust
Customers’ identity verification boosts their trust and confidence in the business. All users have undergone the same verification, so they know their identities are verified and no one can access their accounts.
Document verification can be done in two ways, either traditionally or online. The document verification process verifies the identities of its customers in all financial sectors, from banks to healthcare departments. And prevents all fraud, identity theft, and financial crimes, boosting the confidence of clients and businesses.