Is the end in sight for paper-based verification?
London, UK, July 17, 2008 (PRESSbooth.ORG) -- While the cost of identity fraud reached almost £2bn last year, CIFAS estimates that account takeover fraud - fraud when someone uses another individual's identity to commit fraud - is up around 150% over the past 12 months due in part to the credit crunch. Fraudulent applications for credit are costing lenders huge sums and cracking down on these applications is vital to minimising risk. But for many lenders, the price of verification can seem prohibitive.
And indeed paper-based verification is a significant expense, costing on average around £25 per application and taking up to two weeks to process. It's for this reason that new electronic verification has been so eagerly adopted by lenders - the cost drops to a few pounds and the checking process time is dramatically reduced, lessening the risk of 'losing' customers in the two-week window..
The process of carrying out ID checks can be split in to two parts 1) the Identity check is a method of proving an identity exists and 2) the verification check is a method of proving the person owns the identity. Until very recently, electronic ID solutions have mainly been used to complete the first stage of this process which confirms the Identity exists. The second stage of the process which is needed to verify the person owns the identity is still predominately done using traditional paper-based methods, for example a letter sent to the applicant at their home address. However, developments in technology now mean that robust identity and verification checks can both be done in a single electronic search. This method uses robust data sources to confirm the identity exists and then matches bank account or credit card details to the applicant's name and address to verify the person owns the identity. The whole process can be done instantly real time, saving significant time and cost. And the future looks promising. The ultimate goal, which is certainly achievable, is to employ an end to end electronic verification process and do away with the need for paper checks altogether.
This is a dramatic step in speeding up the approvals process and will mean significant cost savings for lenders and retailers.
By
John Cannon, Verification Expert, Callcredit
Contact:
Sophie Smith
Senior Account Executive
GolinHarris
Fox Court
14 Gray's Inn Road
London
WC1X 8WS
t +44 (0) 207 067 0415
m +44 (0) 7812 214342
f +44 (0) 870 990 5447
ssmith @ golinharris.com
www.golinharris.com
:: 
:: 
::
