Verification knowledge hub
In this article, you’ll learn what a verification vendor is and how to choose the best one.
When onboarding users from different countries, companies face a variety of challenges—including the need to detect fraudsters and comply with regulations. At the same time, companies want to onboard a high number of new users, which is difficult to do with a lengthy verification process.
Knowing the regulatory specifics of every country is another challenge. Some companies delegate this to a separate verification vendor for each operating region, which costs a lot of money.
Instead, companies working with clients from different countries can go for a vendor with expertise in all regional regulations. It’s even better if this vendor can provide a company with customizable workflows that can adapt to document specifics of each country.
When choosing a verification vendor, companies can’t just rely on the first one they encounter. That’s why we’ve prepared a checklist containing the key factors to consider.
Verification vendors provide companies with identity verification software, which checks whether a customer is a legitimate person to prevent fraud, money laundering, and terrorism financing. In many countries, companies working with finance are obliged by law to employ such software.
Here are some key factors a company should consider about a potential verification vendor:
In the sections below, we explain how to evaluate these factors in more detail.
Before choosing a verification vendor, a company should learn about the solutions offered by each provider and check whether they can comply with regulations. The compliance tools that verification vendors implement can be separated into two categories:
KYC checks include:
Most KYC checks can be applied to businesses as well. KYB-specific solutions include:
Vendors may also offer transaction monitoring (solutions, also known as transaction monitoring. This technology allows companies to easily track transactions and detect suspicious activities in a timely manner. Some transaction monitoring features include:
It’s essential to ensure the vendor’s security system and privacy measures are trustworthy. Usually, a company can do it by requesting audit certificates, such as:
These certifications demonstrate the security of a vendor’s security systems. However, it’s still worth asking a few additional questions before moving forward:
It’s also necessary to ask whether the vendor can help the company stay compliant with regulations in operating countries. Therefore, it’s worth checking whether the provider is familiar with different regional regulations (e.g., 6AMLD, BSA, etc.)
Vendors should have features that quickly process users, leading to high customer retention. These include:
If a vendor can provide all these features, the user experience will be as smooth as possible. This means that new customers won’t need to spend much time registering and are more likely to use the company’s services.
A proper verification vendor should be easy to implement. Here’s what should come included:
It’s also important to know the time it takes to integrate the solution.
Companies need to check whether the vendor provides the following services:
Before onboarding a new verification vendor, ask the following questions”
When it comes to pricing, the company should look at all the packages offered by the vendor and ask the following questions:
There’s no definitive answer to what makes for the ultimate verification vendor. However, a proper vendor will have an all-in-one verification platform to protect against fraudsters, compliance-related issues, and user drop-offs. Additionally, it should provide access to a legal team specializing in AML regulations across the world.
To get even more tips on choosing the right vendor for your company, check out our Buyer’s Guide to Verification Platforms.
An identity verification system checks the identity of customers, ensuring their legitimacy. This is traditionally done through obtaining personal information and then comparing it to the government-issued document provided by the customer. Depending on the jurisdiction, the exact information collected and verification methods will vary. That’s why a customizable all-in-one solution can benefit companies working with users from different countries.
An IDV (identity verification) vendor provides verification solutions which help companies stay compliant with the regulations.
There’s no definitive answer regarding the best verification service provider. However, there’s a set of factors that can help a company choose the vendor that fits best: