Secure Onboarding: Why It Matters for Your Business

Effective onboarding has long been a crucial component for modern businesses. It is a critical stage in forming customer relationships and increasing user satisfaction and adoption.

But secure onboarding has sharply risen as a top priority in an era rife with fraudulent activity. The introduction of increasingly complex identity fraud puts every bank, financial institution, and other entity processing sensitive identity information at risk of approving meticulously crafted fakes. Certifying a customer’s authenticity and trustworthiness with enhanced, digitally-driven accuracy becomes imperative.

Accomplishing all of this—while also providing customers with a swift and seamless onboarding experience—always proved a daunting task. Until now. Here’s how to implement a robust and secure onboarding strategy and why it’s imperative to your business’s success and longevity.

The impact of secure onboarding on business operations

Secure onboarding performs double duty: It enables businesses to validate new customers’ identity and risk potential while instilling confidence in the very customers being welcomed. It also levels up the process by:

  • Mitigating fraud: In 2022 alone, 40 million individuals were affected by identity theft, resulting in a staggering $43 billion loss. Financial institutions are especially vulnerable to such criminal behavior during account openings. Secure onboarding that leverages advanced identity verification and predictive analytics (more on this in a moment) helps keep “bad actors” from opening fraudulent accounts, conducting account takeovers, and committing other forms of illicit activity. 
  • Ensuring regulatory compliance: Financial institutions (FIs) are legally obliged to comply with anti-money laundering (AML) and Know Your Customer (KYC) regulations. Accurately determining that new customers are who they say they are through secure onboarding may satisfy part of the Customer Identification Program (CIP) and Customer Due Diligence (CDD) requirements. These rules don’t just apply to the financial sector, either: Other industries, such as gambling, gaming, and home delivery services, must adhere to regulations; they, too, might benefit tremendously from secure onboarding.
  • Increasing customer acquisitions and driving profits: Consumers across the board expect a fast and frictionless digital onboarding experience. Indeed, research indicates that 68% of consumers abandoned a financial application because of snags in the onboarding process. At the same time, they want secure network onboarding that prioritizes data security and safeguards their personal information—now, in proper account setup after approval, and in the future with digital accounts usage. Meeting these demands may boost your customer base, improve customer retention, and ultimately fuel profits.

Enhancing customer trust through secure onboarding 

Above all, one of the biggest impacts secure onboarding can have on your business is that it may foster trust with your customers. Having a balanced onboarding plan in place, or one that employs advanced security measures but aims to curb (or even eliminate) user frustration, suggests to consumers that you’re dedicated to their protection and experience. 

This may be immediately felt and prompt an excellent first impression. However, it can also indicate that you will continue to supply them with secure network access and ongoing reliability. In fact, data demonstrates that 80% of consumers prefer to work with a business that utilizes strong identification verification during onboarding.

An online onboarding use case that’s proven to be particularly effective? Netflix. Onboarding can be achieved with just a few simple steps. Yet, the streaming giant clearly states its instructions and assures data security.

Technologies driving secure onboarding

Traditional onboarding methods—like manually collecting personal information and handling identification verification—are not only lengthy and time-consuming but also prone to human error. Fortunately, technology has revolutionized onboarding and rendered it stronger and more secure in the process. 

These include:

  • Artificial intelligence (AI) and machine learning (ML): AI/ML can both simplify and strengthen onboarding by automating repetitive, tedious tasks, auto-filling forms, verifying identification documents in real-time, cross-validating credit history, conducting liveness checks, and performing screenings to assess a customer’s risk potential (which is fundamental in the financial industry). What’s more, AI/ML can be leveraged to evaluate customer behaviors and preferences, which enables you to design a more personalized onboarding experience.
  • Biometric verification fortifies identity authentication: By using fingerprint scanning, facial recognition, and voice analysis, you can gain peace of mind knowing that your customers are who they claim to be and spot fraudulent actors before they infiltrate your system. Meanwhile, the extra layer of security may bolster customer satisfaction. 

Implementing secure onboarding in your business

The key components of secure onboarding include:

  • Selecting a technology that offers customers an intuitive, easy-to-navigate experience that includes clear, concise instructions for every step in the process
  • Employing AI-powered verification technologies that quickly and accurately certify a customer’s identity
  • Requesting only the most relevant information required
  • Utilizing encryption to ensure elevated security, such as multi-factor authentication (MFA)
  • Providing security awareness training to your team
  • Conducting ongoing monitoring and optimization

Lastly, choosing the right technology partner is imperative. You want to collaborate with a stable and secure provider that can meet the onboarding, compliance, and security demands specific to your industry.

Looking ahead: the future of onboarding security 

Identity theft and other types of fraud are becoming increasingly advanced and complex. Luckily, onboarding technologies are as well. A few of the most innovative and effective approaches we may see in the future include:

  • Enriched biometric systems that analyze physiological traits like heartbeats and veins
  • The use of blockchain to develop centralized KYC platforms
  • Advanced AI technologies, such as the use of AI bots and agents
  • Adopting embedded data analytics to continually analyze the onboarding process, flag deficiencies, and make improvements

Microblink’s approach to secure onboarding

Microblink has one foot in the future of secure onboarding and another squarely in the present, where our cutting-edge BlinkID solution addresses both common and unique security challenges with unprecedented speed, accuracy, and efficacy. Our suite of solutions provides a host of features that may benefit both you and your customers, such as:

  • Screen detection
  • On-device, real-time processing
  • Color photocopy detection
  • Black and white photocopy detection

In turn, you can keep fraudsters out and invite more legitimate, qualified customers in. Excited to learn more? Read our guide to digital onboarding and give our demo a try to discover why we’re a game-changer in identity verification.

May 30, 2024

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