Know your customer (KYC) processes became a legal obligation for online onboarding of customers in financial services. These procedures ensure new customers are who they say they are. Subsequently, the EU adopted the eIDAS Regulation in 2014 to instil trust concerning online and digital transactions. The regulation specifies three levels of assurance provided by different digital identity providers. “However, it was up to EU countries to define the tools needed for each level and the associated financial services allowed per level,” explains Gisle Aasgaard, coordinator of the EU-funded IDAaaS project. “The fragmented landscape also hindered the development of the financial service industry in Europe as a digital single market.” Project partners researched current practices and the need for digital onboarding solutions. They interviewed over 3 000 end users in different European countries about their digital onboarding experiences. Main findings show financial service providers lost almost 40 % of their customers because of poor onboarding processes, despite heavy investments in digital transformations and marketing efforts to attract customers.
Verification and authentication solutions
To enable regulated organisations to engage customers in digital and legally binding agreements, the IDAaaS team developed the Digital Identity Platform. This features secure digital onboarding enabled through identity verification services and meeting regulatory requirements. The platform is scalable across borders, and can be integrated with national identification solutions and other identity data sources. The digital identity hub is the foundation of the digital identity platform. It collects numerous connection points, ensuring that users are able to connect to and verify their customers online. By connecting to the hub, customers can access a wide variety of verification and authentication methods across many European markets. The hub includes connections to over 30 eID schemes in Europe. These eIDs enable the efficient and secure onboarding of end users and authentication of returning customers. The hub also supports a number of registry lookups and data sources for verifying or obtaining additional user information. In addition, information on whether a user is an individual that is a politically exposed person can be verified through the hub. What’s more, it’s easily extensible and can be integrated into different business systems and built on additional identity verification data features.
One-stop shop for identity assurance in Europe
The project is helping regulated businesses across Europe comply with KYC requirements, while simplifying users’ online onboarding and login experience. Service providers receive trusted user identity information by delegating the procedure to identity experts, thus saving time and money. A trouble-free, more intuitive onboarding process via a digital-only solution makes it easier for consumers to sign up for new financial services. “IDAaaS introduced a comprehensive suite of digital identity verification and authentication solutions enabling a complete digital customer journey, from onboarding and authentication to electronic signing of legally binding documents that stand the test of time,” concludes Aasgaard. “Ultimately, there will be a reduction in fraud, greater trust in digital services, and users will be less likely to abandon onboarding applications.”
IDAaaS, onboarding, digital identity, financial service, verification, authentication, eID, digital onboarding, KYC, eIDAS