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Using digital identity for a better customer experience

James Mirfin
James Mirfin
Global Head of Digital Identity & Fraud Solutions, Refinitiv

Screening for corruption and other crime risks should not have to mean a poorer customer experience (CX). As banks and financial institutions embrace new technologies, find out how using digital identity enhances CX in the financial crime fight.

  1. By using digital identity tools, organisations optimise compliance and boost their performance in both risk mitigation and in delivering a better customer experience (CX).
  2. The benefits of using digital identity for a better CX are being felt in retail banking, the merchant services industry, and in the wealth management space.
  3. Refinitiv will soon be launching a new digital identity solution that will offer fast, reliable identity verification and screening via seamless API technology to help #FightFinancialCrime.

Implementing rigorous measures to mitigate financial crime risk and designing a frictionless customer experience can seem like opposing goals.

Mitigating financial crime risk is clearly non-negotiable. Refinitiv’s 2018 True Cost of Financial Crime survey revealed that corruption not only leads to significant financial losses for companies, societies and countries, it also devastates millions of individual lives across the globe on a daily basis.

Sean Durkin quote

Rigorous due diligence and screening remain our best defence against financial crime, but the often manual processes involved can be inefficient and time consuming. Moreover, they frequently involve multiple customer touchpoints that negatively impact the overall experience.

Ensuring frictionless client encounters is becoming a priority for many institutions — a view echoed by Sean Durkin, Head of Data Science at Barclays.

Responding to a question about the bank’s view of AI opportunities, Durkin replied that the bank is “not looking to cut costs”, adding that “for organisations like Barclays, a large focus of our work is on the customer experience. It is the chief focus and revenue benefits are secondary”.

Faced with this set of challenges, forward-thinking organisations are actively investigating innovative ways to replace traditional manual identity verification methods with digital equivalents in a bid to increase the effectiveness with which they mitigate risk and simultaneously optimise the client experience.

Watch video: True Cost of Financial Crime: Creating the Data and Partnerships to fight Financial Crime

Using digital identity tools

The digital identity revolution continues to gain momentum, driven in part by regulations that mandate enhanced consumer protection, as well as by technological advances that enable new entrants in the banking sector with low barriers to entry.

But more than this, the move to using digital identity is being propelled by tech-savvy consumers who demand choice, fairness, flexibility, and an omnichannel experience.

Replacing traditional paper-based identification processes with digital equivalents has broad applicability, as in the following examples:

In the retail banking sector, digital identities can be used in customer onboarding to verify and prove the identity of new customers that apply for new bank accounts, loans, credit cards, or other retail products.

Digital identity solutions

They can also be used to re-verify and re-screen the identity of existing customers seeking to make changes to their personal information online or through call centres.

In the merchant services industry, they can be used to verify and authenticate the identity of users attempting online credit card transactions with in-network merchant accounts.

In the wealth management space, digital identities are being used to onboard high net worth individuals and to authenticate transactions.

Going digital for an optimised approach

By using digital identity tools, organisations can optimise their compliance models and boost their performance in both risk mitigation and, importantly, in delivering a better client experience.

Digital identity verification and proofing are quicker, easier and cheaper than their manual equivalents. This boosts compliance team efficiency, which in turn frees often over-burdened teams to concentrate on areas of higher value-add.

Digital solutions also remove the human error factor, which increases the effectiveness of financial crime screening.

Faster onboarding times and fewer touchpoints positively impact the client experience, but more than this, digital identities provide consumers with the security and control they want as part of the seamless user experience they increasingly enjoy in digitally native businesses.

New due diligence tools can impact #FightFinancialCrime without impacting on the CX

Whilst banks and financial institutions quite rightly continue to focus on identifying risk and rooting out financial crime, they are also increasingly aware of the need to place the customer experience front and centre in the innovation game.

The digital identity revolution could hold the key to achieving both.

Refinitiv will shortly be launching a new digital identity solution that will offer fast, reliable digital ID verification and screening via seamless API technology.