Last Updated on January 31, 2023 by AlexJames
Financial institutions are embracing technological advancements and coming up with transformations such as touchless digital banking. Digitization of payment services is also fueling the growth of Financial Technology (FinTech) companies. However, criminal threats such as account takeover, identity theft, payment scams, and data breaches are simultaneously increasing. Remote access to banking systems, insufficient AML controls, and lax identity verification checks are further creating loopholes for fraudsters.
FinTech companies require robust IDV solutions to combat illicit actions and integrating biometric recognition mechanisms is their reliable bet. Furthermore, they can bring real-time payment authorization to their digital financial systems. Biometric security measures provide behavioral/biological analysis that is hard to breach. This article further discusses how FinTech companies can ensure secure digital onboarding by integrating IDV solutions.
Biometric Security System is an Ally for the FinTech Industry
In comparison to other industries, FinTech companies require enhanced accuracy and security because it relies on digital financial tactics. As a result, money laundering, fraudulent transactions, identity theft, and account takeover fraud are more prevalent in this sector. Cybersecurity threats, data breaches, phishing, spoofing, and deep fakes are other threats surfacing FinTech companies.
With advanced identity theft tools at their disposal, criminals easily pass through inadequate identity verification checks. Therefore, FinTech companies require AI-powered biometric screening solutions to cope with advanced fraud risks. While usernames, passwords, PINs, and OTPs are massively prone to hacks, digital financial service providers need to replace them with real-time selfie-based identification. Biometric recognition solutions also enable FinTech companies to stay with AML laws and prevent strict regulatory scrutiny.
The FinTech industry will reach $213 billion worth of market value by 2024 and due to its rapid adoption, it will foresee more tremendous growth. Therefore, to provide customers with more security, convenience, and risk-free financial services, FinTech companies should make biometric user authentication a part of their digital payment systems. This way, digital financial service providers will be a leap ahead of fraudsters and place necessary restrictions in place to restrict their onboarding.
Biometric-Based Identification – A Blend of Two Analysis
AI-powered biometric recognition is a blend of two checks – biological and behavioral. These refer to the analyses of distinct human traits that are impossible to replicate. Biological checks refer to facial verification, iris/retina scans, palm vein pattern analysis, and fingerprint validation. Moreover, behavioral identification involves gesture inspection, voice recognition, liveness detection, and background checks. This combination of biometric screening solutions enables FinTech companies to counter fraud risks and simplify onboarding.
Integrating biometric ID verification is enhancing security in FinTech companies by providing more secure touchless banking options. It further offers easy data management, real-time payment authorization, and ongoing monitoring of transactions. Hence, FinTech companies can deal with financial crimes more proactively.
Biometric User Authentication is the Key to Secure FinTech Servies
FinTech companies are striving to provide customers with a secure digital financial services landscape. They are replacing long-existing and risk-prone account log-in methods with biometric recognition solutions. By offering remote customer identification and touchless banking services, FinTech companies are shielding their operations from identity theft, spoofing, and deepfakes. With biometric identity verification, there will be less room for cybercriminals to exploit digital financial services.
Facial Verification for Touchless Payment Authorization
AI-powered biometric security checks come with facial verification technology that uses mathematical algorithms to map and analyze biological traits. While cybercriminals can easily hack usernames, passwords, and PINs, advanced IDV services enhance the protection of digital banking accounts. Furthermore, with facial verification, payment authorization not becomes easier but also error-free.
With biometric recognition, customers will not have to face the additional hassle of carrying cash, using credit/debit cards, or logging into applications. Moreover, by using their facial features users can make touchless payments and access their financial records more easily.
Fingerprint Validation for Authorized Account Log-ins
FinTech companies using biometric security systems are less likely to face account takeover fraud and unauthorized access to digital financial records. By using phishing attacks, criminals obtain crucial information from customers, which they later use for exploiting online banking services. However, FinTech companies can eliminate the need for creating complex passwords.
With biometric screening and fingerprint analysis, customers can log in to their accounts more securely. Over 64% of the passwords were compromised lately which increases the need for FinTech companies to enhance safety against criminal actions.
Since digitization brought abruptions to every traditional banking operation, customers are demanding more convenient, seamless, and risk-free digital onboarding. In wake of this, FinTech companies are accelerating the integration of biometric screening solutions to provide touchless services. These IDV services are strengthening AML controls required to monitor ongoing transactions and detect suspicious behaviors. Hence, with biometric recognition, FinTech companies are countering cybersecurity threats while providing secure and fraud-free financial services.