In merchant acquisition, the underwriting process is particular, but it is also necessary in order for organizations to approve new merchant account applications with confidence. Companies must verify the legitimacy of an applicant and evaluate specified financial information before a new account can be activated. Traditionally, this process has relied heavily on manual techniques, which have a number of significant challenges. Card processors and other financial institutions are now turning to improved identity verification techniques to automate processes, stop fraud, and improve the customer experience.
ID Verification Streamlines Underwriting
The step-by-step process of verifying an applicant’s identity manually can be extremely time-consuming. Financial organizations can waste precious time and resources during the authentication stage even before conducting normal underwriting assessments of a merchant. In today’s highly connected environment, merchants are looking to gain immediate financial access. Manual verification just cannot keep up with the demand, thus driving the need for underwriting automation.
Implementing an ID verification solution such as IDology’s ExpectID product suite allows processors to electronically proof and verify merchant identities quickly and efficiently. It also lessens the burden on staff members and takes guesswork out of the equation.
Stop Fraud through Automated Verification
Armed with the stolen identity of an individual, a fraudster’s goal is to use this information to get past underdeveloped security mechanisms. This is why it is important for organizations to gain confidence that the applicant is who they say they are instead of a criminal utilizing his or her personal identity information. Doing so allows fraud to be stopped before it makes its way into the underwriting stage. However, organizations should also ensure that they are not increasing the level of friction for legitimate customers. They can do this by dynamic escalation to higher levels of verification only when needed through a multi-layered authentication solution.
An identity verification and fraud prevention solution that dynamically escalates to knowledge-based authentication (KBA), for example, allows companies to establish the identity of merchants and applications during the acquisition process. Merchants are presented with a brief set of out-of-wallet questions that are generated dynamically, in real time, to eliminate the possibility of a fraudster simply looking up or social engineering the responses. Fraud is kept out, while legitimate customers are allowed to progress.
Improved Verification Breeds Higher Customer Satisfaction
With manual verification and underwriting, both the organization and the applicant are put through a lengthy process that can be challenging for both sides. An automated process leads to improved relationships with customers, in addition to reducing risk of fraud. Legitimate applicants are verified much more quickly and efficiently, saving time and resources for all involved. In addition, the financial services provider has fewer fraudulent accounts and can process more applications in less time. Knowing that a merchant’s identity has been validated confidently, using expert tools, adds peace of mind and more trust to the business-customer relationship.
The need for financial institutions to improve the underwriting process by automating processes, stopping fraud, and raising customer satisfaction has led organizations to implement ID verification solutions for assistance. To learn more about how IDology’s ExpectID product suite can add eliminate fraud and enhance business operations, contact a representative today at (866) 520-1234.