Query: What’s the distinction between identification verification and authentication?
Shai Cohen, senior vice chairman of world fraud options, TransUnion: As extra providers shift to a digital format, customers and organizations are threatened by extra environment friendly and developed types of fraud. To verify {that a} buyer is who they are saying they’re requires each identification verification and identification authentication.
These two phrases usually are not synonymous or interchangeable, and the organizations that do not know the distinction make themselves weak to elevated fraud losses. Treating a verified identification (“this identification exists”) as authenticated or proofed (“this consumer is who they declare to be”) makes a company weak to account takeover fraud and artificial identities.
Securing Account Creation and Use
The mixture of a reputation, deal with, cellphone quantity, and e-mail on an internet kind can present sufficient data for a corporation to confirm a shopper’s identification and set up a layer of belief when an account is first created. This data will be checked in opposition to a number of information sources, resembling utilities or phone carriers, to make sure the identify matches the opposite qualifying information.
It is vital to notice, nonetheless, that verifying that the identification exists doesn’t show it belongs to the particular person getting into that data. Criminals can use illicitly obtained figuring out data to use for brand new accounts or advantages in victims’ names. Some create artificial identities the place credentials have been fabricated and usually are not related to an actual particular person however can idiot verification processes.
Such a identification theft has prompted a shift towards proofing or authentication practices. These approaches require considerably extra rigor than merely verifying that an identification exists. Organizations work to substantiate that the identifiers provided to create a brand new account belong to the particular person getting into the data — i.e., that the applicant is who they are saying they’re. Some identity-proofing methods might request a selfie and authorities picture ID for a facial recognition match from new prospects.
Authentication, however, is an ongoing identity-proofing course of that each checks the identification of digital customers and ensures the integrity of the units they use. Two-factor authentication and one-time passcodes are each generally used authentication strategies that assist grant account entry to the best particular person in actual time.
Observe that safety measures should steadiness shopper wants. A 2021 examine from the CMO Council reported that authentication frustration prompted 61% of customers to desert a transaction, and TransUnion’s 2022 “World Digital Fraud Tendencies Report” confirmed that roughly two-thirds of customers would change corporations for a greater digital expertise. Organizations ought to incorporate each identification verification and authentication processes in order that they’ll guarantee protected interactions and create a trusted digital channel that retains customers coming again.
