Identity Verification for Retail & eCommerce
In general terms, the fraud in online retail refers to committing transactions with the use of stolen or fake information:
- Credit card data;
- Account data;
- Bank account details;
- Credit card details.
The largest e-commerce fraud concern, however, is identity theft, when the combination of the abovementioned illegal actions is used with the client’s personal information (name, address, etc.) to make a purchase.
Fraudsters employ this data in diverse ways, from stealing physical documents to phishing attacks. Unfortunately, the more advanced the technology becomes, the more sophisticated tools hackers invent for fraudulent actions. Ultimately, in the U.S. only, up to 10% of the population suffer from identity theft attack each year. Therefore, retailers need to take adequate precautions.
Stopping fraud requires continual preventative efforts, which include measures ensuring that all transactions are safe, and all users are genuine. In this regard, eCommerce organizations must adhere to Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations.
Basically, legal compliance denotes that organizations must extensively employ identity verification tools to authenticate new clients, guard existing ones against account thefts, and prevent illegal transactions. However, retailers should also ensure that security measures do not impede customer experience since additional steps required for verification may increase cart abandonment and alleviate customer satisfaction.
KYC Use Cases in Retail & eCommerce
The lack of proper identity verification
The key issues with identity verification in the retail industry include the failed attempts of buyer onboarding, a lack of consumer validation, and insufficient digital identity security during the whole process.
Identity verification is intended to prevent dubious actors from entering the system. The respective digital solutions provide seamless ID checks and KYC & AML compliance. The robust verification system aids retailers in the following:
- Eliminating supply chain and delivery problems;
- Streamlining omnichannel transitions;
- Offering efficient onboarding solutions;
- Reducing the risk of cyberattacks;
- Implementing excellent digital identity security and monitoring.
An abandoned cart refers to an incomplete purchasing process. It occurs when a buyer starts checking out but does not finish the online purchase for some reason. It can happen because of inconvenient payment options, missing product details, personal doubts, or other concerns. However, one of the core reasons for cart abandonment is the lack of credibility.
With effective identity verification services in place, retailers can elevate customer trust, thereby minimizing unfinished purchases. When a business has a reliable reputation, clients are more likely to complete their purchases since they have reasons to believe in the security of their online transactions.
Buying behavior and habits are changing drastically. Users strive to make informed decisions and seek information on products across multiple platforms. Correspondingly, eCommerce businesses should adapt to address the needs and requirements of modern buyers.
What exactly can retailers do to keep up?
Providing a secure customer experience is essential to attracting consumers. The robust identity verification system will help:
- Guarantee a smooth omnichannel customer experience;
- Streamline order fulfillment;
- Enhance cybersecurity;
- Drive visitor conversion.
As fraudsters are deploying increasingly sophisticated tactics, retailers become more exposed to cyber-attacks threats. Advanced identity verification methods help to minimize, if not eliminate, the risks of payment fraud. Modern solutions employ a range of techniques aimed to confirm the authenticity of a user. Therefore, buyers can feel protected and assured that their personal information stays untouched.
The stolen credit card transactions are responsible for a significant part of payment fraud in eCommerce. When fraudsters gain access to the information from the user’s account, they obtain an opportunity to make illegitimate transactions.There are plenty of forms of identity verification that help counteract fraud with credit cards. Modern solutions can perform the following:
- Data extraction from documents – when a customer uploads a picture of their physical ID, and the system extracts the data from it with the following processing and verification;
- Liveness detection, when users are asked to take a video of themselves to check their ID;
- Watchlists auto checks, when the system automatically scans for forged documents to explore whether a customer has a suspicious background.
for Retail & eCommerce Industries