Feb 23, 2024
7 min read

The Future of the Customer Verification is Here: Document-Free Methods and Their Benefits

Learn about different types of non-document verification methods and their benefits

Even with flawless UX and fast internet, document verification can be a time-consuming process resulting in customer drop-offs. But what if we told you that businesses can now onboard users in 45+ countries in milliseconds, with no need to upload or scan IDs?

Let’s compare documentary vs non-documentary verification, dive deeper into what document-free verification is, and explore its many benefits.

In this article, we use the term ‘document-free’ to describe verification methods that don’t involve uploading document scans—this includes verifying digital identity on the blockchain or through a credit bureau check. It’s important to note that ‘document-free’ is not synonymous with ‘Non-Doc,’ which exclusively refers to Sumsub’s Non-Doc Verification product.

Document verification: The traditional method

Document verification usually includes checking authenticity and accuracy of documents, such as passports, IDs, driving licenses, or financial records, to verify the identity of an individual. The process typically involves reviewing, cross-referencing, and comparing information on physical documents or scanned copies of them. This verification process is commonly used in various fields, including financial institutions, insurance companies, real estate services, etc.

More advanced document verification includes several security feature checks, such optical character recognition (OCR), pattern recognition, and MRZ decryption.

However, there are some challenges with traditional document verification methods:

  • The need for manual checks. Verification of physical documents still may involve manual work, which can be time-consuming and inefficient. This can lead to delays in service provision and increased operational costs. 
  • Furthermore, physical documents can be forged or altered, making it challenging to rely solely on the visual inspection of documents.
  • The inconvenience of uploading documents. Document verification can be a big obstacle, especially when new users need to urgently access a service. Sometimes, documents simply aren’t at hand. 

For these reasons, the world is moving towards document-free verification.

Document-free verification

Document-free verification confirms identity quickly without relying on physical documents.

Methods of non-documentary identity verification include:

  • Digital identity on blockchain, which many EU, MENA and CIS governments have provided as national digital IDs
  • Credit bureau checks
  • ID verification across databases through a certified third-party identity provider (Non-Doc Verification)
  • Verification through Qualified Electronic Signatures
  • Identity, Address and Age Verification through reliable database checks (Global Database Verification)

Global Database Verification 

Global Database Verification is one of the best doc-free verification products for businesses seeking a reliable, efficient, and cost-effective solution for customer onboarding.   

Global Database Verification includes only three simple steps:

  1. The user provides their personal data, such as full name, national ID number, date of birth, address.
  2. Sumsub cross-matches the info against all applicable sources in the relevant country.
  3. Once the data is verified, Sumsub sends match results about each individual data attribute to the service the user is onboarding to, and the user is redirected back to the customer portal.

Additional measures may include biometrics, device authentication (OTP), and document validity checks  to further strengthen verification and prevent fraud.

Altogether, this allows you to get the following benefits:

  • A document-free verification solution for a wide range of both regulated and non-regulated industries, with up to 5.5 billion users potentially verifiable 
  • User verification in a matter of seconds
  • +37% pass rate growth.

Non-Doc Verification

Non-Doc Verification, another document-free product from Sumsub, provides a dependable and efficient alternative to ID-based user verification and onboarding. Its functionality involves extracting and verifying comprehensive customer data from government sources.

Non-Doc Verification is a completely standalone and secure procedure that works in two ways, depending on the country:

  1. By extracting personal and biometric data from a government source based on an ID document number and photo cross-match
  2. By extracting the required data attributes from banking records via account login and device authentication

Depending on the jurisdiction, the entire KYC process may be substituted with Non-Doc, in addition to a Liveness check—a simple verification process completed in a matter of seconds.

Non-Doc offers the following benefits for business:

  • Increased pass rates and fraud-free onboarding
  • Scalability in new markets with 2+ billion new users
  • Reduced errors and increased business performance, as user data is instantly updated in user profiles.

Global Database Verification (GDV) vs Non-Doc: What’s the difference?

GDV and Non-Doc Verification can both be utilized for user verification, either as  supplementary checks or as substitutes for the entire KYC process. Nevertheless, the suitability of each varies based on the industry and regulatory requirements.

GDV:

  • GDV can be a standalone check for non-regulated industries. For regulated businesses, it may be a post/pre-screening check as part of the overall KYC process.
  • GDV may require several data inputs, including full name, date of birth, national ID number, address, and phone number.

Non-Doc Verification:

  • Non-Doc Verification can serve as full user onboarding both for regulated and non-regulated industries.
  • Non-Doc Verification either requires the input of identity data, like an ID number, and a Liveness check to submit biometric data. It can also use  bank credentials and device authentication.

GDV and Non-Doc Verification can perform:

  • Identity Verification: verifying user ID numbers and personal data authenticity by matching it against recognized and secure sources. 
  • Age Verification: verifying users’ dates of birth and personal information, ensuring they meet specific requirements regarding age-restricted content and services
  • Address Verification: ensuring the legitimacy of current customer residence information, extracting and cross-referencing data with trusted global sources

In the case of GDV, the data provided is cross-referenced across many databases and the result is either a match, no match, or partial match. 

For Non-Doc Verification, a full user record is extracted and cross-referenced against specific sources to produce match results and an  up-to-date user profile, including identity, age and address fields.

Document-free verification: The benefits

  • Enhanced security. Document-free verification methods are difficult to forge or manipulate, making it harder for individuals to impersonate others. By cross-referencing ID data with government databases, organizations can reduce the risk of fraud, such as synthetic identity theft or the use of fake identity documents.
  • Cost savings. Organizations can save on administrative costs associated with document handling and storage when using doc-free verification methods, especially when it comes to address verification.
  • Accuracy. Government databases are typically highly accurate and up-to-date sources of information.
  • Fast user onboarding. Document-free verification can be faster and more efficient for both businesses and users, as it eliminates the need for users to provide physical documents and reduces manual document review.
  • Scaling across global markets. Sumsub’s GDV and Non-Doc allow businesses to expand their global reach with confidence, efficiently scaling operations in new markets backed by reliable and diverse data sources.

Document-free verification: Primary vs. secondary 

Primary non-document verification confirms an individual’s identity without relying on traditional paper documents. This may involve the use of strong authentication measures, such as biometrics (fingerprint scans, facial recognition, etc.) or multi-factor authentication (combining something the user knows, like a password, with something the user has, like a smartphone for receiving a code). This process establishes the baseline identity of an individual before additional layers of verification may be applied, and is typically used by non-regulated entities. 

Secondary non-document verification adds additional layers to the primary verification process, including further checks against databases, behavioral analytics, and more. 

Document-free verification and compliance

Document-free methods of identity verification can be Anti-Money Laundering (AML) compliant, but it depends on the region. Businesses must therefore ensure that their document-free verification methods comply with AML regulations in the jurisdictions where they operate and be aware of regulatory changes.

A combination of GDV (or Non-Doc), along with the collection of additional documents or information, if applicable, the cross-checking of data, and the confirmation of identity through liveness can guarantee 100% AML compliance, even for high-risk cases.

Non-Doc

Non-Doc Verification is a compliant way to onboard customers in many regions, including Argentina, Australia, Brazil, Canada, Colombia, Ghana, India, Indonesia, Malta, Nigeria, New Zealand, Philippines, South Africa, UAE, UK, USA.

GDV

Similar to Non-Doc, GDV can be used as a standalone verification method in the countries states above, where the AML regulations allow verifying the customer’s identity through reliable electronic sources. In particular, in the USA, the UK, Malaysia, Indonesia, etc.  

The United States

Bank Secrecy Act (BSA), the main Anti-Money Laundering (AML) legislation in the US, describes which information needs to be collected about customers in “Customer Identification Program: minimum requirements” (CIP). 

The BSA also states that both documentary and non-documentary verification methods (as well as their combinations) are acceptable so long as
(i) the chosen procedures ‘’enable to form a reasonable belief that it knows the true identity of each customer”; and,
(ii) in case a non-documentary solution is elected, the firm applies additional procedures to address the risks where “the customer opens the account without appearing in person”.

Check this article to learn about detailed requirements of CIP.

US AML regulations could be compatible with non-documentary customer identification methods, however the AML-obligated entities performing it must be assured it knows the true identity of its customer. To ensure this, they can use additional KYC mechanisms, such as biometric checks. 

The UK

In the UK, document-free verification methods are approved by regulations and can be utilized by businesses.

Sumsub offers Non-Doc Verification in the country, which can be used for multiple use cases, including ID, address, phone number, and age verification. 

Sumsub’s Non-Doc Verification can be conducted in three stages:

  • The user selects their bank and is instantly redirected to the bank’s login page 
  • The user logs into their bank account and consents to share the required data
  • Sumsub retrieves the verified data, confirms the customer’s identity automatically, and onboarding is complete.

Here are the benefits of Non-Doc Verification in the UK: 

  • It’s done in approximately 4.5 seconds
  • It relies on a banking app, so all that customers need is their bank account rather than a physical document.
  • Data transfers are fully protected using the TLS 1.3 encryption protocol.
  • It’s compliant with UK AML regulations, provided that additional security measures are incorporated. 

Other jurisdictions

Non-Doc Verification is currently available for full user onboarding in Argentina, Bangladesh, Brazil, Indonesia, India, Kenya, Nigeria, the Netherlands, and South Africa. 

Sumsub GDV allows you to potentially verify user data for over 5.5 billion people worldwide—all done quickly and securely without uploading multiple documents. 

Use cases

Non-Doc Verification can be used by crypto, gambling, fintech, transportation, e-commerce, and other industries. It has multiple use cases, including ID, address, phone number, and age verification. 

Global Database Verification can be used as a standalone verification solution or in combination with other verification products. Some use cases include user pre-verification, where data is pre-screened before the full onboarding process, and user post-verification, which double-checks information submitted during the onboarding process.

A combination of Non-Doc and/or GDV with a document-based method could be a bulletproof option for high-risk cases or where regulations require checking the customer’s identity against multiple sources. 

Both Non-Doc and GDV may be used for continuous monitoring with reliable data instantly updated in user profiles.

FAQ

  • What are some non-document methods of verification?

    Non-document verification methods may include public databases or other 3rd party electronic ID verification services.

  • What are some examples of non-document verification?

    Sumsub’s Global Database Verification method (including Identity, Address and Age Verification) and Non-Doc Verification (checking ID numbers through certified ID providers, like banks in the UK) are the best examples of document-free verification methods. 

  • When can the non-doc method of customer information verification be used?

    The non-doc method of customer verification may be used in different industries, including fintech, crypto, e-commerce, iGaming, transportation, and insurance businesses. There are multiple use cases, including identity, age, and address verification.

Disclaimer: The information provided in this article is for general informational purposes only and is not intended to constitute legal advice.

AMLBiometricsIdentity VerificationKYCSecurity