Biometrics has revolutionized customer identity verification in every financial institution. For example, smartphones have the abilities to authorize financial transactions using a built-in facial identification feature (FaceID) or fingerprint. Generally, it has improved customer satisfaction and most businesses are in a race to exploit biometric technology to their advantage. But what is this biometric technology and how does it influence KYC and AML policies?
What are biometrics?
Biometrics like the name implies refers to a system of measurements related to human characteristics. Biometrics authentication is used as a form of identification everywhere, from transactions to security because of its full-proof advantage.
Types of biometrics
There are roughly two categories: physical and behavioral identifiers.
Physical identifiers are a certain fixed set of human characteristics, such as:
- Voice recognition is used by some telephone-based and digital service portals to authenticate customers.
- Fingerprint scan as a way of confirming the identity of the user became immensely popular in recent years due to its deployment on smartphones. It is also the most common type of biometric authentication.
- DNA scans are too slow to be implemented in the fast business environment and are commonly used in law enforcement to identify suspects.
- Signatures are quite common at retail checkouts and in banks where customers are already expecting to be asked to sign their names.
- Photo/video of a person apply to facial recognition — an approach with growing popularity among services that need to confirm client identity online.
Thinking of a better and more accurate biometric check? Check out how Sumsub fast onboarding reaches 97% hit rate, minimizing fraud and performing biometric analysis—pattern screening, 3D face tracking, micromotion detection and more.
Behavioral identifiers are new to the public and are usually combined with other methods of authentication. The advantage of the behavioral identifiers is that it is highly customizable, only limited by imagination and can be adjusted to the likes of your specific business. These are the ways behavioral identifiers help companies to filter out spam and separate a human from a bot:
- Physical movements are sometimes used to confirm a person’s identity online when asking users to move in a certain way and comparing the request to what the system detects in front of the sensor.
- Typing style of an individual is also a sort of a behavioral identifier that can be screened for a recognizable pattern match.
- Engagement patterns are something that differs from person to person. The way an individual interacts with a technology, where they click and what apps they use are unique behavioral characteristics.
Some of the mentioned biometrics are used in antispoofing to expose malevolent users, imposters who are seeking to gain access to private accounts and use them to their advantage.
Is biometric authentication safe for businesses and their clients?
By capturing an individual’s fingerprints, voice, and face and comparing it to a pre-existing database, the person’s identity can be quickly verified, saving time and expenses.
At the same time, companies have to be aware of the way they distribute this valuable and sensitive information and learn to protect it. The problem is that if these types of biometric checks are used separately there will be a potential of false positives: facial recognition systems can be tricked by wearing a mask or showing a picture of the user, voices can be pre-recorded and fingerprints can be faked given enough motivation.
That is why financial companies and institutions, in particular, are recommended to use multiple types of biometric authentication as a wholesome strategy for fraud prevention. Having a couple of such physical and behavioral identifiers combined you can be sure that no one will fool your security system.
For example, there is liveness—a new popular solution on the market that allows users to create an account and log into the system within minutes just by using a document of choice and a selfie camera that provide all the necessary data for the system to let them in. The solution is more highly sophisticated and uses multiple steps of analysis such as 3D, image depth, voice, and micromotion checks.
Often liveness doesn’t prove to work as expected. So, how to choose liveness that won’t let your business down? Find out more about the right solution based on our trial and error experience on the topic.
Implemented in a professional way, biometric identity verification allows financial institutions to comply with KYC/AML regulations and at the same time offer maximum customer satisfaction.