Science fiction has a rich history in predicting technological advancements. Jules Verne’s novel From the Earth to the Moon (1865) anticipated space travel, whilst Fritz Lang’s visionary film Metropolis (1927) showed a world full of robots. In the late 20th century and early 2000s, facial recognition was a futuristic fantasy. Remember 2001: A Space Odyssey and Minority Report? Today, facial recognition is being used by consumers to unlock their phones and computer screens, and it’s becoming increasingly common during onboarding flows across the financial services industry. It’s not just facial recognition that’s going mainstream, though. Research by The Economist Intelligence Unit in 2020 pointed to an increasingly influential role for biometrics (either fingerprint, facial or voice recognition) in our lives. At the time, 85% of executives believed biometrics would be used to authenticate the majority of payments in the next 10 years. In the auto industry, we’re seeing a growing role for biometrics in areas like fingerprint authentication to start a car, and personalise vehicle settings such as music, seat mirror position, navigation, and temperature when an interior camera recognises the driver’s face. But the immediate opportunity is to use biometrics alongside other identity verification solutions to accelerate the application process and deter fraudsters. At the moment, it’s estimated that outdated onboarding processes and a lack of digital options are driving good applicants away. In fact, studies show up to 70% of consumers drop off during the application process. With loyalty so closely linked to premium service and accessibility, it’s vital to make sure your consumers’ onboarding experiences aren’t cumbersome. There’s a clear business case for using biometrics. TransUnion research has found South African consumers to be relatively comfortable with advanced identity verification, such as one-time passcodes or facial recognition, in their financial services relationships. | Just over four in 10 (42%) of South Africans said they would be comfortable being asked for advanced identity verification when applying for a financial product online; nearly half when creating an online account at a financial services company (49%); and a similar percentage would be happy to use biometrics when logging in to an existing online account at a financial services company (47%). What we’re seeing is that consumers increasingly expect businesses to bake in robust security checks into customer experiences. An additional benefit of embedding these solutions into onboarding flows is they can act as a deterrent to fraudsters, moving them away from your ecosystem before they do damage. Competition is fierce. TransUnion research indicates one in three consumers globally are planning to apply for new credit or refinance existing credit (mortgage, car loan, credit card, personal loan or student loan) within the next year, so optimising the onboarding flow is a top priority. For example, facial verification can reduce the trade-off between fraud and security, and support efforts to look and feel like a leading technology brand. It’s crucial, however, that a facial recognition solution makes onboarding convenient and doesn’t create too much friction; is inclusive; and prevents fraud by deterring fraudsters and more accurately detecting fraud. Document verification is a great example of how layered identity verification solutions can shorten the application process. By more securely, quickly and accurately validating consumer-provided identity documents against trusted data sources, you can reduce identity fraud risks while offering a convenient, digital customer experience. As adoption of biometrics increases, it’s crucial that the auto industry starts exploring available options. Don’t get left behind: a proactive approach now can better position your business to keep pace with this evolving technology that seems to be here to stay. To learn more about the benefits of optimising your customer onboarding experience, download our new insight guide, Digital Onboarding: A Guide to Unlocking Growth. |
