To say technology has contributed greatly to evolution is to say the least. Among the many beneficiaries of the digital era are startup businesses.
Thanks to mobile technology and the internet, businesses have transitioned from traditional settings to digital adoption. The emphasis on e-commerce, online platforms, and digital marketing as a result of this change has affected consumer behaviour and market dynamics.
Businesses now prioritize social responsibility and sustainability at the same time. Today's business environment demands data-driven decision-making and agility to keep up with the rapid advancements in technology and changes in the wider world.
Startup businesses have been cushioned greatly with the introduction of technology. One of the major ways technology has helped startup businesses is in the area of identity verification.
Before we look into the rapid evolution of identity verification for startup businesses, it is important that we understand the key terms in this piece.
What is a Startup Business?
Startup business is a young business in its early operational stage. Typically, entrepreneurs launch startups in order to meet perceived market needs for their products or services.
Startups typically confront enormous obstacles in their early stages, such as high beginning expenses and limited revenue streams. They are known for aggressively seeking money from a variety of sources, including angel investors, crowdfunding websites, and venture capitalists, in order to get past these obstacles and accelerate their growth.
This funding is essential for developing new products, growing markets, and building a strong base for sustainability in the future. Businesses of about five years and above are no longer categorized as startups. Although this categorization depends on some achievements, the years of existence of the business are also important to consider.
What is Identity Verification?
Identification verification is a painstaking process that compares a person's stated identification to the documentation they provide. In essence, it entails carefully examining identification documents and supporting documentation to confirm and authenticate that the claimed owner is, in fact, who they claim to be.
Officially issued documents, security passes, and legal certificates are all essential parts of this verification process because they are important pieces of evidence that prove identity.
In recent years, the process of identity verification has been carried out digitally, as opposed to the traditional method of the past. This has helped businesses achieve accuracy in processing the authenticity of documents provided by an individual.
Why is Identity Verification Important?
- Identity verification is essential to safeguarding confidential personal and financial data. It protects sensitive Personal and financial data from unauthorized access or misuse.
- It is essential in a variety of situations, including banking, hiring, regulatory compliance, and age verification for services or goods that are prohibited.
- Building long-term relationships with customers and stakeholders requires the development of trust, which is facilitated by identity verification services.
- Organizations can drastically lower the risk of monetary loss, harm to their brand, and legal exposure related to identity-related risks and fraud by requiring identity verification.
- Given the increasing frequency of online transactions in the modern day, identity verification is even more important in the fight against online fraud and cybercrime.
How is Identity Verification Evolving for Startup Businesses
As a result of legislative changes, technology improvements, and the growing demand for seamless and secure operations in startup businesses, there’s been an increased need for identity verification. With the consistent use of identity verification, it is inevitable that there will be some evolution.
The primary reason for this evolution is a result of detectable loopholes in the identity verification process and the need to make the process more efficient and reliable.
Below are some ways in which identity verification has evolved:
- Biometric authentication techniques, such as facial recognition, iris scanning, and fingerprint scanning, are becoming more common. These technologies are being used by startups to improve user experience and security.
- Because smartphones are so widely used, more and more startups are putting mobile first when it comes to identity verification. Mobile app-based verification and SMS-based authentication are two increasingly common mobile verification techniques.
- Startups can now use decentralized identity solutions thanks to blockchain technology. This lowers the possibility of centralized data breaches and gives individuals more autonomy over their personal data.
- ML and AI algorithms are applied to risk-based authentication. These systems look for trends in user behaviour to spot possible fraud and modify their verification procedures accordingly.
- Startups are concentrating on assuring compliance with numerous regional and industry-specific regulations, such as GDPR, KYC (Know Your Customer), and AML (Anti-Money Laundering), as laws pertaining to identity verification become more stringent.
- Startups are increasingly adopting fully digital onboarding procedures for remote onboarding and digital identity verification. This includes the onboarding process being streamlined by the use of digital identity verification tools that enable users to remotely verify their identity.
- A growing number of startups are collaborating with identity verification services. By offering reliable and safe identity verification solutions, these services free up startups to concentrate on their main business operations.
- Enhanced Security with Multi-Factor Authentication (MFA): For startups, multi-factor authentication is increasingly the norm. They require users to provide multiple forms of identification, like a password, a fingerprint scan, or a one-time code, adding an extra layer of security.
- Startups are realizing the value of a positive user experience when it comes to identity verification thanks to user-centric design and enhanced user experience. Improved customer satisfaction is a result of creating user-friendly interfaces and reducing friction in the verification process.
Suggested Read:
1. Trends in Digital Identity Verification in Nigeria
2. How selfie identity verification works
Bottom Line
Reliable and secure methods of remotely verifying identities are made possible by modern online identity verification services, which increase efficiency and convenience. With the evolution of identity verification, startup businesses have been able to curb financial loss, reputational harm, and legal exposure, to mention a few.
It is one thing to know about the process of identity verification and another thing to find the right solution for it. At YouVerify, we care about your system security and ease the KYC process through effective technological solutions. Request a demo today to see how it works.