Last Updated on July 17, 2024 by Asfa Rasheed
The increasing number of online businesses has opened a new channel for fraudsters. The increased technology and the rising number of online shoppers put pressure on vendors to embrace a digital platform. The automated system of buying and selling, along with its various benefits, have some risks as well. Criminals became wiser and came up with sophisticated ways of causing harm to vendors and buyers. According to a report, consumers lost $43 billion to identity theft last year. Identity verification services provide businesses a way to reduce the chances of online fraud.
Fraudsters always remain in search of loopholes in the system to attack. The developers need to be very smart while creating an application. The easiest way to do fraud online is by attacking someone else’s identity or hiding their original identity, a process called identity theft. To combat identity theft, identity verification services are used.
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Your Identity Is Your Thing, Do Not Let Any Fool Steal It
Businesses are too vulnerable to online fraud, and fraudsters are continually coming up with never-ending ideas to commit fraud. No business would want to associate its name with investigations, screaming headlines, and heavy fines. The thinking of it is no less than a nightmare. But as every problem has its solution, similarly some ways can fight online fraud. All one has to do is become smarter to come up with innovative ideas. Identity verification solution is the technology helping organizations to onboard legitimate customers.
Onboarding authorized customers is the first step organizations can take to protect themselves from having any unfortunate experiences in the future. It can be achieved if enterprises have something at their end to ensure the onboarding of honest individuals. Technology has blessed companies by suggesting solutions to this problem. With identity verification services, merchants can verify their consumers playing their part to protect themselves.
Fraudsters harm the reputation of businesses and their clients’ financial data and use it for identity fraud. Identity theft is an online fraud that refers to obtaining information of another individual and using it to commit fraud. One of the most prevalent frauds occurring on digital stations is identity theft.
How Fraudsters Steal Personal Data
Consumers are required to be careful in dealing with their personal information. Individuals who commit fraud use smart ways to complete their fraudulent activities. Some ways to commit identity theft are the following:
Physical theft
Personal information of the consumer like their name, address, credit card details, and bank statement can be stolen.
Phishing
Fraudsters can send emails under the name of an authorized bank or organization and ask the consumers to send their personal and financial information.
Cold Calling
Some fraudsters can pretend to be calling from a bank support or service provider and trick the users into sharing personal information like name, address, and bank details.
Hacking
Hackers break into the computer system and hack the data of the customer.
Oversharing
Consumers also behave carelessly at their end when it comes to their credentials. Social media has taken over the thinking capabilities of humans. Users now share every little thing of their life on social apps. At times they do not even notice and share their sensitive information like pictures of credit cards that fraudsters misuse easily.
Ways To Fight Identity Theft
Online frauds can be prevented. The thing is, businesses have to be well-equipped to protect their privacy. And the customers’ information. Following are some ways merchants use to combat identity theft:
- Identity theft can be controlled by protecting customers’ data. Companies must ensure that they encrypt users’ information before storing or transmitting it. Businesses must carefully provide data to employees they know can take care of it.
- Establish effective business policies that incorporate strategies. About how the information of the users is going to be saved in the firm’s record. Remove sensitive information of the customers that is not useful anymore.
- Design rules for customers when they come to perform any activity. For instance, if a customer pays from a credit card, ask for a code present at the back of the credit card. Verify the address of the customer to confirm that the card really belongs to the individual claiming it.
Compliance Rules For Businesses
Considering the rise in online frauds, compliance professionals have designed rules for business entities to abide by. These regulations help businesses to prevent their source of income from facing any unfortunate event. Vendors, when they fail to comply, have to go through reputational damages and customer loss and fall under legal activities of paying hefty fines. Regulatory authorities are working in favor of businesses. And protecting customers are destined to eradicate digital fraud.
Overview
Identity verification services have become increasingly popular over the years as a way to protect individuals and businesses against the growing threat of identity fraud. This type of service provides a strong defense against these threats by helping to verify the identity of a person, organization or entity reliably and securely.
Identity verification services use various techniques to authenticate an individual’s identity. These techniques may include checking government-issued identification, verifying personal information such as date of birth and social security number, or even using biometric data such as fingerprint or facial recognition. By using these methods, identity verification services can ensure that the person claiming to be someone is actually who they say they are.
The benefits of identity verification services are many. They help prevent fraud and identity theft, which can cause significant financial and personal harm to individuals and businesses. Additionally, they help to create a more secure environment for transactions, whether they be online or in-person. This is particularly important for businesses that deal with sensitive information or financial transactions, as it can help to prevent unauthorized access and reduce the risk of data breaches.
Conclusion
Identity verification services are a way of fighting against identity theft. Businesses can corporate regulatory KYC/AML compliance to protect themselves from facing illegal activities performed by fraudsters.
Read more: Online Document Verification: Shrinking The Space for ID Fraud.
