Onboarding Intelligence: The Key to Building Trust in a Digital World
The digital economy has fundamentally changed the way people live. It’s impacted daily habits but also consumer expectations – transacting online is now not only possible, but the preferred and, for many, the expected way of accessing goods and services. Whether it’s transferring money from a smartphone or signing up for a new bank account, the interaction between a customer and business is more frequently completed in a fully a digital journey.
In this backdrop, identity verification at onboarding has become much more than a box-ticking exercise. This is now a critical stage for organisations to know if a potential customer is really who they say they are, or if they are a fraudster in disguise.
Identifying fraudsters at the first point of contact
Accurate and robust identity verification decisions at the first point of contact – onboarding – could be the difference between blocking a malicious actor before they have a chance to transact with your business or letting them into your system, ready to exploit their access for fraudulent purposes.
Yet, our recent survey of 1,200 senior fraud prevention, risk and compliance professionals across Europe, US and Asia Pacific revealed many organisations are still leaving the door to their business open to fraudsters, preferring to catch them mid-journey rather than at the onboarding stage.
Only 35% are investing the most spend and resource for fraud detection and prevention at the account opening stage, while almost two thirds (65%) are choosing to prioritise ongoing transaction monitoring to catch fraudsters at the payment or withdrawal stage. A significant minority (30%) are not using any fraud risk signals at the start of their onboarding journey. With this insight, it’s unsurprisingly that a third (31%) say they find it extremely difficult to identify fraudsters at the point of onboarding.
Onboarding intelligence: building trust from the first point of contact
The question is, how can businesses more easily spot and stop fraudsters at onboarding? The answer: onboarding intelligence.
Onboarding intelligence is collective term for a rich mix of identity data, history, and behavioural insights from various commercial and government sources. These insights help brands identify promising customers and detect fraud signals from suspicious identities, stopping fraud before it even gets into their business.
The important part about leveraging onboarding intelligence, is that it doesn’t just identify potential fraud signals but by leveraging rich identity insights, businesses can identify good and great customers.
With this insight, businesses are empowered to give potential customers a personalised journey, cost-effectively, preventing fraud at the very start of the journey but also reducing friction for good, low risk customers. This ultimately optimises KYC spend, increasing ROI on compliance for organisations.
By leveraging alternative data points, onboarding intelligence also helps to increase identity inclusion for thin-file, new-to-country customers, or those without an ID document, who can be unfairly excluded from accessing goods and services through traditional and binary Know Your Customer (KYC) checks.
Cross-sector and cross industry collaboration
In an interconnected digital economy in which fraud doesn’t discriminate, trust testing at the point of customer onboarding will increasingly be a common concern and a collective endeavour for brands that rely on identity confidence to do business.
But for organisations to gain a more granular view of an identity at onboarding, collaboration across sector and other industries is critical. Currently, concerns around data privacy and potential loss of competitive advantage are prevents organisations from collaborating. But it’s critical organisations across all industries overcome their reluctance to share identity intelligence to fight fraudsters. Sharing consumer intelligence to combat fraud does not mean a business will lose its competitive advantage – this is a dangerous myth. The fact is that businesses do not share raw data within consortia, but anonymised patterns and insights on confirmed or suspicious fraud. This has a huge benefit for all businesses – regardless of sector or location.
As new technologies are increasingly leveraged by fraudsters – such as GenAI accelerating the production of synthetic identities, deepfakes and counterfeit documents – businesses need to trust-test the identity data and documents that appear on their platforms. Onboarding intelligence is the future of building trust with customers by increasing inclusivity within the identity verification journey for good customers while spotting and stopping fraudsters at the same time.
Authors
Laura Barrowcliff
Laura Barrowcliff is the Head of GBG Trust at GBG, the global leader in identity and location. Laura leads GBG Trust, the global identity network, which combines over 100 million data attributes contributed by a consortium of over 740 businesses covering 24 sectors in over 80 countries, whilst ensuring complete data privacy. With insights from GBG Trust companies can securely leverage powerful cross sector consumer insights to detect fraud and onboard more good customers.