How Biometrics Improve Security as a Know Your Customer Tool
August 3, 2023 | 4 minute read
In an era marked by digital transformation and increasing instances of cyber threats, businesses across various industries are seeking robust solutions to verify their customers’ identities securely and efficiently. Biometrics have rapidly emerged as a “Know Your Customer” (KYC) tool, offering a new layer of security that traditional authentication methods struggle to match. Particularly, industries like banks, telecom, and others that necessitate a high level of trust in their customer base are increasingly adopting biometrics as a powerful tool to combat fraudsters and ensure a seamless user experience.
Understanding Biometrics and its Advantages
Biometrics refers to the use of unique biological and behavioral characteristics to identify and authenticate individuals. Some common biometric features include fingerprints, iris patterns, facial recognition, voice recognition. These features are difficult to replicate, making biometric authentication a highly secure method for verifying customer identity.
The advantages of using biometrics as a KYC tool include:
- Enhanced Security: Biometric data is highly individualistic and challenging to forge, reducing the risk of unauthorized access and identity theft.
- Improved User Experience: Unlike traditional authentication methods involving passwords or PINs, biometrics offer a more convenient and seamless user experience, eliminating the need to remember multiple passwords.
- Efficient KYC Compliance: Biometric technologies aid businesses in complying with KYC regulations and mitigating the risk of fraudulent transactions.
Using Biometrics as a KYC Tool in Telecom
The telecom industry faces its fair share of identity-related challenges, including SIM swap fraud and unauthorized access to customer accounts. Biometric solutions have emerged as a reliable method to protect digital identities and secure telecom services:
SIM Registration:
Biometrics enable telecom companies to link SIM cards to a verified individual’s biometric data, reducing the risk of SIM swap fraud.
Customer Service Authentication:
Biometric verification can be used during customer service interactions to ensure that only authorized individuals can access sensitive information or make account changes.
Secure Mobile Payments:
Biometric authentication adds an extra layer of security to mobile payment apps, enhancing the trust and confidence of customers in making digital transactions.
Using Biometrics as a KYC Tool in Banking
Banks have been at the forefront of adopting biometric solutions to bolster their security and combat financial fraud. Traditional methods like passwords and PINs are prone to hacking and social engineering attacks, compromising customer data and trust. Biometric authentication methods have proven to be a game-changer for banks in several ways:
Multi-Factor Authentication:
Banks are implementing biometrics alongside other authentication factors, providing an extra layer of security.
Mobile Banking:
With the increasing use of mobile banking, biometric authentication offers a secure and user-friendly approach, allowing customers to access their accounts with a simple fingerprint or facial scan.
Fraud Detection:
Biometrics can detect and prevent account takeovers and fraudulent activities, reducing financial losses for both banks and customers.
Using Biometrics as a KYC Tool in Other Industries
Beyond banking and telecom, various other industries are leveraging biometric technology to build trust with their customer base:
- Travel and Hospitality: Biometrics are used at airports for seamless and secure passenger verification during check-ins and border control.
- Healthcare: Biometric authentication is employed to protect patients’ medical records and ensure secure access to sensitive healthcare information.
- Retail: Retailers are using biometrics to enhance the security of online transactions and prevent fraud during loyalty program redemptions.
Get Started Using Biometrics to Help “Know Your Customer”
As fraudsters become increasingly sophisticated in their methods, businesses in various industries must adapt by adopting advanced technologies to protect their customers and their sensitive data.
Depending on your industry and use case, here are a few solutions to explore if you want to take advantage of biometrics as a KYC tool:
AwareID: Lightning-fast identity verification, multi-factor authentication and multi-modal biometrics in a single, low-code platform.
Knomi: Mobile biometric framework leveraging face and voice for enrollment and multi-factor authentication.
BioSP: Modular, interoperable middleware platform enabling advanced biometric data processing and management between separate and disparate systems.
AFIX Tracker: Full-featured automated fingerprint, palmprint, multi, and latent print identification, with optional face capabilities.
