FB pixel

AI identity verification efficiency could make European digital lenders more competitive


Identity verification powered by artificial intelligence could reduce the costs of Know Your Customer and Anti-money Laundering processes by 70 percent, while speeding them up by 80 percent, according to new research released by Mitek and conducted by fintech researcher Autonomous NEXT.

The claim is included in the whitepaper European Digital Lenders: How operating efficiency is helping digital lenders attack a $150 billion annual origination market across the Eurozone in 2018, which also shows that while onboarding times have been reduced from six weeks to a matter of minutes in the digital realm, the cost of customer acquisition for banks remains close to $300 each, with KYC and AML requirements making up as much as half of that cost. The research also suggests that digital lenders are having trouble competing with big banks on price due to the cost of capital, which is not likely to decrease soon.

“The digital lending sector has grown dramatically in the last few years and is a great example of how technology can democratize access to financial services. But banks still dominate lending, and digital-first lenders are struggling to provide loans on better terms than their traditional rivals given high cost of capital,” says Autonomous NEXT Global Director Fintech Strategy Lex Sokolin.

The report also says that venture capital investment in European digital lending will soon reach $800 million, with originations from the UK alone reaching $6 billion, and an addressable market across Europe of $150 billion. Digital lender revenues are estimated at $400 million currently, a 60 percent CAGR from 2013.

“Fintechs and digital lenders in particular need to ward off inefficiency and drive the best possible customer experience,” adds Mitek EMEA Managing Director Rene Hendrikse. “Identity verification technology could give digital lenders the competitive edge they need, and may help them take market share away from traditional lenders.”

Mitek recently appointed Max Carnecchia, who has led multiple businesses into acquisitions, as the company’s new CEO.

Related Posts

Article Topics

 |   |   |   |   | 

Latest Biometrics News


Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

ID16.9 Podcast

Most Read This Week

Featured Company

Biometrics Research

Biometrics White Papers

Biometrics Events

Explaining Biometrics