Going Branchless – Mobile Onboarding for Banks

June 23, 2022     |    4 minute read

Going Branchless – Mobile Onboarding for Banks

June 23, 2022     |    4 minute read

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FINANCIAL SERVICES

How Latin American banks are using Knomito win more customers and prevent fraud

Dramatic advances in mobile phone technology and networks present banks the opportunity to make their services more accessible. Customers can now use their mobile devices to quickly apply for new accounts and credit lines, access their account information, and perform purchases and transactions, all without ever visiting a branch or ATM. Credit towards purchase of big-ticket items such as home appliances, electronics, and furniture can be issued on the spot by retailers at the point of purchase.

For Aware’s banking customers in the region, biometrics — and facial recognition in particular—are playing a big part in making mobile banking more accessible by making it more convenient and secure.

By many measures, Latin America leads the world in adoption of biometrics for commercial applications, and financial services companies are a major contributor to the trend. For Aware’s banking customers in the region, biometrics—and facial recognition in particular—are playing a big part in making mobile banking more accessible by making it more convenient and secure.

In every case, the banks are using “liveness detection” offered as part of Aware’s Knomi™ mobile biometric authentication solution. Liveness detection is used to ensure that the facial images being collected can be trusted for a variety of biometrics-based security checks. It’s applied during onboarding of new customers as well as for enhanced login to mobile apps using biometric authentication.

Examples of fraud prevented by facial recognition and liveness detection 

Banks in Latin America are all too familiar with the many ways that fraudsters can attempt to steal from them and their customers; among them are “presentation attacks” that attempt to defeat biometric security mechanisms. In some of the most common cases, fraud is perpetrated not by strangers but by family members and even employees. Career fraudsters tend to rely on techniques that are more repeatable. In both cases, biometrics make onboarding and authentication more resilient to fraud, but require liveness detection to do so. Following are some examples of presentation attacks and the role of liveness detection. 

INSIDER ATTACKS 

A common category of fraud is committed by a known party; a family member, friend, or co-worker with relatively easy access to identity data of their unsuspecting target. They attempt to use it to impersonate their victim to either open a new account in their name or to access their existing account without their knowledge. Using facial recognition makes these types of attack much more difficult; adding voice biometrics, even more so. In either case, liveness detection is necessary to prevent the perpetrator from using a photo or video of their victim—a “spoof”—to impersonate them. 

A less common category of insider fraud is perpetrated by bank employees. Here, an employee collects identity data from an account applicant as part of their onboarding process but then also takes a photo or video of them using their personal mobile device. The applicant doesn’t recognize that this is not part of the standard process. The employee then uses the account information and customer’s facial image to access the new account; the customer’s credit line is gone before they ever get to use it. Liveness detection prevents this type of insider attack. 

SYNTHETIC IDENTITIES 

Yet another category of fraud involves the creation of “synthetic identities” that are created and used by fraudsters to get credit and loans that they never plan to pay back. They can do this over and over by using sets of identity information that are either completely fictional or based partly on a real person. Facial biometrics can be used to help secure a mobile onboarding process against the use of synthetic identities. But without liveness detection, a fraudster could use a photo or video of someone else, or a selfie in which their face is partially obscured. This prevents the image from being used for several useful biometric onboarding security mechanisms.

How Latin American banks use Knomi to enable secure, low-friction onboarding 

New customers are a critical source of any bank’s revenue growth, so onboarding them efficiently is among the most important functions they can perform. But onboarding is also a time when banks are most vulnerable to fraud. Onboarding is largely an exercise in identity verification, where the bank attempts to gauge whether a potential account holder can be trusted with a line of credit and will behave as a customer in good faith. 

Banks that have incorporated Knomi software into their onboarding process can leverage an applicant’s live selfie to conduct several identity checks that serve to positively verify their identity and to detect when fraud is being attempted. 

For more information on how Latin American banks are successfully leveraging mobile biometrics, please download our whitepaper. Or, click here for more on Aware’s Knomi mobile biometric authentication framework.

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