Digital identity verification: online identification

Identity verification, an essential component in authenticating individuals, plays a crucial role in building trust in digital transactions. Its primary function is to ensure that a person is who they claim to be. However, in the digital realm, an inevitable question arises: how can the security of this process be guaranteed?

O

nline identity verification involves the implementation of robust measures to prevent impersonation and ensure the integrity of personal data. In this context, cybersecurity becomes undeniably relevant, as transmitting sensitive information over the network carries inherent risks. To address this concern, various technologies and strategies are implemented to ensure a secure and reliable identity verification process. 

Artificial Intelligence and biometrics in service of secure authentication and online identity verification 

One of the primary approaches is the use of biometric methods, which have become an effective option for verifying an individual’s authenticity. Unique features such as fingerprints, facial recognition, and voice patterns are key elements in identity verification. These methods not only provide an additional layer of security but also aim to simplify the process for users, eliminating the need to remember complex passwords. 

Furthermore, the use of identity verification technologies based on artificial intelligence (AI) is gaining ground. Advanced algorithms can analyze behavioral patterns, devices used, and other indicators to assess the authenticity and presence of a user. 

At TrustCloud, we integrate AI, for example, in intelligent data extraction from documents of any type (AICR) or in the detection of deepfakes in identification processes. This dynamic and adaptive approach provides a very strong defense against increasingly sophisticated fraud attempts. 

The implementation of encryption protocols and security in data transmission is another essential component in online identity verification. Advanced encryption systems ensure that personal information is securely transmitted, mitigating the risk of unauthorized access during transfers between the user and the platform. 

Know Your Customer: comprehensive identification processes, official list analysis, and risk assessment 

In the banking sector, as well as in various business sectors, the identity verification process is commonly identified as KYC, which stands for Know Your Customer. This procedure is crucial as it enables financial institutions to understand their customers’ identity in detail and assess and mitigate risks associated with fraudulent or illicit activities. 

KYC involves the collection, verification, and analysis of detailed information about customers, including personal data, official documentation, and, in some cases, financial information. The rigorous implementation of this process not only complies with regulatory and legal requirements but also strengthens defenses against money laundering and terrorist financing (AML/CFT). 

In the banking sector, KYC is deployed from account opening to the ongoing management of the customer-bank relationship. It is also highly useful in other contexts such as insurance, financial leasing and renting services, or cryptocurrencies. 

Contact our experts in identity verification and KYC. 

The widespread adoption of the KYC process responds to the need of financial institutions to ensure the integrity of their services, build trust, and comply with regulations. This proactive approach to identity verification not only benefits banks and fintech but also contributes to the overall security and transparency of the financial system. 

In addition to opening bank accounts, online identification is applied in accessing social networks and marketplaces, where it is increasingly common to find methods that rely on Multi-Factor Authentication (MFA), in booking travels and stays, or in real estate transactions. 

In the tax domain, the online filing of income tax returns greatly benefits from identity verification. The security in this process ensures the correct linkage of tax information with the taxpayer, avoiding possible errors, misunderstandings, or even cases of identity theft. The efficiency and precision derived from identity verification contribute to the integrity of the tax system. 

Multilayered security video identification process 

Video identification is an increasingly widespread process to verify an individual’s identity remotely, through a simple video call. This method not only improves convenience for the user but also integrates various layers of security to ensure authenticity and prevent potential fraud. 

TrustCloud has developed its own video identification solution, offering assisted and unassisted modes with various configuration possibilities. With TrustCloud VideoID, there is no need to schedule a prior appointment. Simply by clicking a link, the user initiates a secure and intuitive process that culminates in identity verification in just 3 minutes. 

VideoID combines the analysis of an official identity document with a selfie of the applicant thanks to the FaceMatch detection technology. Additionally, it conducts a liveness test that strengthens the procedure to the maximum. 

All generated digital assets are stored in a qualified manner in Vault, TrustCloud’s custody module. Vault ensures that the collected information has not been manipulated, applying timestamps, and prevents unwanted data deletion. 

Identity verification in the complex global regulatory landscape 

There are various international regulations that influence online identity verification processes. Some of the most relevant regulations include: 

• General Data Protection Regulation (GDPR) of the European Union. The GDPR establishes specific rules regarding the collection and processing of personal data, including information used in identity verification processes. It ensures the privacy and security of individuals’ personal data. 
• Payment Services Directive (PSD2) of the European Union. PSD2 sets stricter security requirements for payment service transactions in the European Union. It introduces Strong Customer Authentication (SCA), directly impacting identity verification processes in online financial services. 
• Foreign Corrupt Practices Act (FCPA) of the United States. FCPA has implications for companies conducting identity verification in an international context, as it establishes standards related to the prevention of bribery and corrupt practices. 
• USA PATRIOT Act of the United States. This law establishes requirements for identity verification in the financial sector in the United States, with the aim of preventing money laundering and terrorist financing. 
• Confidential Information Transactions Act (CITL) of Canada. This Canadian legislation sets requirements for the collection, use, and disclosure of personal information. 
• California Consumer Privacy Act (CCPA) of the United States. CCPA grants California residents certain rights regarding the privacy of their personal data, including information used in identity verification processes. 
• Personal Data Protection Act in the Republic of China (Taiwan). This Taiwanese law also regulates the collection, processing, and use of personal data. 

These are just some of the regulations influencing online identity verification processes. Companies must stay updated on specific regulations in their jurisdictions and areas of operation to ensure regulatory compliance. In this regard, the role of digital identity solution providers is essential, as technological advancements are meaningful only when aligned with strict compliance and serve the user’s interests. 

Request personalized guidance from one of our identity verification specialists.