Query: What’s the distinction between id verification and authentication?
Shai Cohen, senior vice chairman of worldwide fraud options, TransUnion: As extra companies shift to a digital format, shoppers 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 id verification and id authentication.
These two phrases are usually not synonymous or interchangeable, and the organizations that do not know the distinction make themselves susceptible to elevated fraud losses. Treating a verified id (“this id exists”) as authenticated or proofed (“this person is who they declare to be”) makes a corporation susceptible to account takeover fraud and artificial identities.
Securing Account Creation and Use
The mixture of a reputation, handle, telephone quantity, and e mail on an internet kind can present sufficient data for an organization to confirm a shopper’s id and set up a layer of belief when an account is first created. This data will be checked towards a number of information sources, comparable to utilities or phone carriers, to make sure the identify matches the opposite qualifying information.
It’s important to notice, nonetheless, that verifying that the id exists doesn’t show it belongs to the individual getting into that data. Criminals can use illicitly obtained figuring out data to use for brand spanking new accounts or advantages in victims’ names. Some create artificial identities the place credentials have been fabricated and are usually not related to an actual individual however can idiot verification processes.
Any such id theft has prompted a shift towards proofing or authentication practices. These approaches require considerably extra rigor than merely verifying that an id exists. Organizations work to verify that the identifiers equipped to create a brand new account belong to the individual getting into the data — i.e., that the applicant is who they are saying they’re. Some identity-proofing techniques might request a selfie and authorities photograph ID for a facial recognition match from new clients.
Authentication, alternatively, is an ongoing identity-proofing course of that each checks the id 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 fitting individual in actual time.
Notice that safety measures should steadiness shopper wants. A 2021 examine from the CMO Council reported that authentication frustration brought about 61% of shoppers to desert a transaction, and TransUnion’s 2022 “World Digital Fraud Tendencies Report” confirmed that roughly two-thirds of shoppers would change firms for a greater digital expertise. Organizations ought to incorporate each id verification and authentication processes in order that they’ll guarantee secure interactions and create a trusted digital channel that retains shoppers coming again.
