Banks grapple with digital ID and remote onboarding in Canada, Germany and Nigeria

Up to $100 billion in value could be created in Canada by 2030 through lowering the friction that accompanies government and business interactions, according to a blog post reviewing a recent webcast on ‘Digital Identity in Financial Services: Today and Tomorrow,’ hosted by OneSpan.

A pair of experts from the Digital ID & Authentication Council of Canada (DIACC) joined the podcast to discuss digital identity now and in the future, and how financial institutions fit into the new national ID framework the country is developing.

Manulife Head of Global Compliance Program AMLATF Eugenio DiMira says that allowing trusted organizations to exchange records can deliver value by reducing risk, and support open banking, which is expected to come to Canada in the next several years. Changes made by Canada’s government in 2019 allowed photo ID capture and biometric facial recognition to be used to establish credential authenticity. Many institutions in the country have yet to implement these kinds of technologies, however.

The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has relaxed some other rules to ease remote onboarding, but transactions made with the new methods will require re-identification later. TD Bank VP of Digital Channels and DIACC Board Vice-Chair Franklin Garrigues believes 2020 will be a big year for digital ID in Canada, as banks try to catch hold of the value it promises amid stay-at-home guidance.

As they do so, the DIACC is working to ensure the interoperability of ID networks like Verified.Me and VON, so they can be part of Open Banking systems and broader Pan-Canadian Trust Framework.

Banks advance digital onboarding in Germany, struggle in Nigeria

The financial sector in Germany is moving towards what PwC calls “next-generation client onboarding,” Fintechnews Switzerland reports, with a thriving industry of companies providing biometrics and other technologies for electronic know your customer (KYC) checks emerging onto the market.

Citing a 2018 survey from PwC which shows digital client onboarding was already well established, Fintechnews Switzerland identifies market players including IDnow, with its patented biometric video identification and digital signing solutions used by several leading banks and fintechs. KYC Spider, Trust Fractal and 4Stop are also singled out as providers of KYC, anti money-laundering (AML) services and anti-fraud protections to the German market.

The publication also cites research last year by Signicat which indicates 38 percent of applications for financial services in Europe are abandoned, with 70 percent of the 30 percent who had used mobile-first services saying the experience was an improvement.

Onboarding customers digitally is a challenge for 85 percent of banks, KPMG Africa Partner and Digital Transformation Lead Boye Ademola told the audience of a KPMG Digital Channels Scorecard online event, according to the Nigerian Tribune.

The finding is based on a review by KPMG of 17 retail banks in Nigeria, which found that only a couple of the banks have put technologies in place to reduce the risk of identity theft, even as COVID-19 has necessitated a shift towards digital interactions.

Article Topics

biometrics  |  Canada  |  DIACC  |  digital identity  |  financial services  |  fraud prevention  |  Germany  |  identity verification  |  IDnow  |  KYC  |  Nigeria  |  OneSpan  |  open banking  |  remote authentication  |  Signicat