What is Phone Number Verification For KYC Onboarding?

A phone number is used as a means of identification, especially in our increasingly expanding digital world, where numbers, usernames, and email addresses are often used to identify persons virtually without the certainty of a physical examination.

 Digital identities are becoming increasingly used as the digital world expands. More effective measures to confirm or validate digital identities need to be implemented.

Phone number verification for KYC onboarding process is a vital part of an identity verification process and the Know Your Customer (KYC) process as a whole. The right phone numbers can reveal correct and accurate details of the person who owns them, from names to addresses or a national identification number, depending on the laws of the region.

Phone number verification for KYC onboarding can also aid communication and marketing processes. The collection of phone numbers from customers during the onboarding process is usually prone to inaccuracies, as phone numbers may easily be switched to another or filled incorrectly, or customers may simply present a fake number. The relatively “non-discrete nature” of phone numbers also contributes to this “volatility.” 

This is where phone number verification comes in. It is an automated way of how to check a number is genuine.

It is essential to take streamlined and accurate measures to verify the phone numbers of customers to aid KYC and operational measures, avoid sanctions and losses, and prevent identity fraud and related activities through verified phone number verification.

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What Is Phone Number Verification?

Phone Number Verification, a type of identity verification, refers to the process done to confirm that a phone number provided by a user is accurate or valid and belongs to the person claiming ownership. 

Phone number verification is important for ensuring data accuracy, preventing fraud, and improving communication. It's commonly used in Know Your Customer (KYC) processes, account registrations, two-factor authentication (2FA), and other security measures to validate user identity and reduce the risk of fake or incorrect phone numbers.

Why Is Phone Number Verification for KYC Onboarding an Effective Tool for Risk Management?

Phone number verification allows businesses to verify the authenticity of users and reduce the occurrence of crimes such as fraud, identity theft, and fake accounts. Phone number verification provides a simple yet effective way to reduce risks and protect both businesses and customers.

By confirming that a phone number is valid and belongs to the person providing it, companies can:

1. Phone Number Verification Can Help To Prevent Fraud

With phone verification, businesses can verify that customers are who they claim to be. This means they can better prevent themselves from fraudulent activities, such as identity theft and account misuse.

2. Phone Number Verification Enhances Security

Verifying phone numbers adds an extra layer of security during transactions and account creation, especially for two-factor authentication (2FA). It is also efficient because it prevents the submission of fake numbers.

3. Phone Number Verification Improves Data Accuracy

Phone number verification makes sure that customer information is available readily and easily and, therefore, allows personnel to decide what further actions to take promptly.

 A simple, quick API call analyses the number and reveals important information, including validity, roaming status and country, country of origin, current route, availability, and current and original network.

4. Phone Number Verification Enhances KYC and Other Compliance Efforts

Phone verification supports regulatory requirements like Know Your Customer (KYC), helping businesses stay compliant and avoid penalties.

5. Phone Number Verification Reduces Losses

By identifying and stopping fraudulent behavior early on, businesses are able to avoid financial losses associated with scams and security breaches.

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Why Do Users Provide Fake Phone Numbers for Verification?

Sometimes, or most times, customers may prefer or decide to present or provide fake numbers during an onboarding process, and this can lead to inaccurate data records and security vulnerabilities. There are several reasons why customers can present fake phone numbers during the onboarding process; they include:

1. They Are Concerned About Their Data Privacy 

Users or individuals are becoming increasingly paranoid about data privacy, with major or mainstream digital platforms orienting themselves more toward big data and data farming methods.

As digital marketing becomes increasingly intrusive, users are wary of sharing their real phone numbers due to fears of spam calls, text messages, or unauthorized use of personal information.

2. They Want To Avoid Marketing Messages 

As digital marketing becomes increasingly intrusive, some users may prefer to provide false numbers to avoid receiving promotional calls, texts, or notifications that they expect to follow after the verification process.

3. They Are Hesitant About Sharing Personal Data

With increasing concerns about data privacy and breaches, some users may be hesitant to share their real contact details; instead, they choose to provide a fake or temporary number.

4. Some Customers Who Provide Fake Numbers May Have Fraudulent Intentions 

Sometimes, individuals with malicious intent might use fake phone numbers to engage in fraudulent activities in order to avoid detection or prevent accurate tracking.

5. They Are Impatient Or Do Not Find The Onboarding / Identity Verification  Process Convenient 

Some users may see the verification process as an unpleasant barrier and might provide a fake number simply to bypass the verification step, especially if they believe it’s not necessary for the service they are signing up for.

What Is the Benefit of Phone Number Verification for KYC Onboarding?

Correctly verifying phone numbers is important for maintaining data integrity. Verified phone numbers result in better KYC procedures, enhanced operations, and greater protection against fraud and misrepresentation (identity fraud). 

It ensures that the information collected from customers is accurate and reliable, reducing the risk of financial loss, regulatory sanctions, and fraud.
 

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Why Is It Important To Use Phone Number Verification Software?

What are the benefits of phone number verification? Corporations and entities, especially outfits that operate mostly on digital platforms, need to prioritize how to verify a phone number collected during the onboarding process. Phone number verification, as a vital part of the identity verification process, has a variety of digital companies and financial institutions, especially fintechs. 

Phone number verification software validates phone numbers easily and more accurately. It is simple yet easily more accurate than most types of identity verification methods.

How to Perform Phone Number Verification in Nigeria

How do you verify a phone number in Nigeria?

Follow these steps to verify a phone number using Youverify’s solution:

Step 1: Gather User Information
Collect the user's phone number along with optional details such as name, gender, and personal identity number during the onboarding process.

Step 2: Submit Data via API
Send the collected information to our Identity Verification API, which queries the government database using the phone number.

Step 3: Receive Real-Time Results
The results will indicate whether there is no match, a partial match, or an exact match, along with detailed data from fields that correspond with the input.

If a phone number isn't found in the database or is entered incorrectly, the system will display a "record not found" message. Additionally, the service can detect if the phone number is invalid for the specified country, allowing for prompt corrections and ensuring the accuracy of the information.

To verify your phone number in Nigeria, click to know more.

Phone Intelligence and Verification By Youverify

Youverify offers a suite of effective compliance software to aid seamless compliance processes for companies of all sizes. Its phone intelligence and verification software can provide detailed phone data for risk assessment, identify fake account signups, and perform data segmentation analysis.

This service covers the seven continents of the world.

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Bottom Line 

Phone number verification for KYC onboarding process is important for the digital world we have today and is more helpful to businesses than ever. Businesses need to make sure that they collect data during onboarding processes to comply with compliance policies or legislation. 

Phone number verification for KYC onboarding helps prevent fraud, enhance security, and maintain data accuracy while also supporting compliance with regulations like Know Your Customer (KYC). By using phone verification tools, companies can better manage risks, reduce financial losses, and improve communication with customers.

Youverify’s Phone intelligence and verification software is compliance software for companies of all sizes. It offers detailed phone data for risk assessment, identifying fake account signups, and performing data segmentation analysis (phone data analysis). It performs global phone verification, and this service is available worldwide, covering all seven continents.

 Book a free demo and get access to seamless automated compliance, including effective phone number verification and intelligence.