The United Kingdom grapples with a growing problem of identity fraud and financial fraud. In 2022, UK Finance reported an astounding loss of £1.3 billion due to authorised push payment (APP) scams. This stat is enough to tell us why background checks are essential for organisations that are operating their businesses in the UK. In the digital landscape of the UK, laws and regulations constricted against financial crimes such as money laundering, terrorist financing, financial scams, and illicit funding.
It is the area where the identity verification system assists in the authentication process for UK businesses and organisations, checking the background of the business partners, investors, and clients during the onboarding process. It helps recognise potential risks, mitigate risks, identify identity fraud, and prevent fraud.
Traditional background checks are falling short in the digital age:
- Tradional background checks are manual identity verification process and time-consuming as well, requiring references and criminal records to check the background of the client.
- This background verification has geographical restrictions and lacks depth verification.
Effectiveness of KYC solutions for Background checks:
KYC solution is an integral part of the digital identity verification process that authenticates various ID documents and ensures they are genuine or not. Digital KYC solutions play a pivotal role in background checks in the financial and non-financial industries. KYC solutions in the UK are significant to ensuring the financial KYC regulations for companies and preventing the hefty fines of Financial Conduct Authority (FCA) regulations. It quickly identifies and verifies the identity of the client and assists in recognising the fraud identity and theft. Other various areas where KYC verification is adequate are:
Faster Onboarding:
KYC helps businesses authenticate clients’ identities instantly and in seconds and facilitates seamless client onboarding. It speeds up the onboarding process for various financial and non-financial sectors, such as banking, financial, cryptocurrency, fintech, insurance, trading, online gaming, healthcare, real estate, telecommunication, and e-commerce businesses.
Minimise fraud:
KYC is a powerful tool that identifies fraudulent identities and provides an alert for suspicious identities. It helps businesses decide whether to do business with them, reducing the chances of fraud and safeguarding the business.
Enhance security:
KYC adds an extra layer of protection and ensures that an unauthorised identity can’t access sensitive information. It reduces the risk of fraudulent activities such as identity theft.
Cost Efficiency:
Manual background checks are time-consuming and require human resources, which is also cost-consuming. Digital KYC solutions are very effective, time-saving, and cost-saving. KYC solutions automate the identity verification process and help in seamless onboarding.
Regulatory Compliance:
By leveraging advanced identity verification techniques, such as KYC solutions, ensure compliance for businesses and keep updated with the latest compliances in the UK.
Improve Customer Experience:
While prioritising security and compliance, KYC solutions providers in the UK allow for a seamless onboarding process and provide a frictionless customer experience.
Build Trust:
In the digital age of the UK, trust is paramount for any business deal. KYC solutions help build trust by ensuring whether the client’s identity is legitimate or not. After completing the KYC process, companies onboard new clients and do business transactions with them.
AML Verification:
KYC verification is a process of business identity authentication. It includes collecting identity information that assists in background checks through AML verification. The information collected during the KYC process helps to be thoroughly verified through various adverse media, PEP, and sanctions list databases and delivers accurate results. It assists in thorough background checks.
Background checks are crucial in the digital age to learn about the backgrounds of new business partners, vendors, clients, and investors. KYC is not only a compliance solution tool for UK businesses; it is also an entirely artificial intelligence (AI) powered and OCR technology-based risk evaluation method, or in short, an advanced fraud prevention technique.
This fraud prevention technique helps UK businesses combat money laundering, financial fraud, identity fraud, and theft. Whether small, medium, or large, KYC solutions allow companies to stay ahead of the curve in compliant businesses with advanced biometric verification, face recognition, and liveness detection techniques. They safeguard businesses and remain compliant with financial regulatory standards.
Conclusion:
KYC solutions have emerged as indispensable tools for conducting adequate background checks for businesses in the UK. It is not just a choice but a necessity for companies that mitigate risk, minimise fraud, recognise identity fraud, have a seamless onboarding process, frictionless client experiences, fraudless reputation, and safe business transactions. Therefore, choose a KYC services provider in the UK that provides comprehensive identity verification solutions according to the business need. Empowered your financial and non-financial businesses with advanced technologies of KYC solutions and stay advanced in the digital world.