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Biometric and SSI tools for financial services compliance launch as regulatory landscape shifts

buguroo, Nuggets launch new solutions as governments ponder changes
Biometric and SSI tools for financial services compliance launch as regulatory landscape shifts

buguroo has launched a Policy Manager for its behavioral biometric fraud protection tool, Fraudster Hunter, for customizable automation of alerts to stop fraud in progress before new accounts and be created or existing ones compromised, or a network of mule accounts can be created.

The new feature comes as part of the latest product update for Fraudster Hunter, and allows fraud analysts to create rules based on a range of suspicious and fraudulent activities to proactively prevent fraudsters from carrying out transactions. All user transactions in the customer journey can be scanned and the rules applied to step up authentication or terminate the transaction, based on the degree of risk.

The company says the rules can be stored and used to build up complex, customized fraud prevention systems.

“Fraudster Hunter’s new ability to proactively stop fraud using proven fraud identifiers greatly improves fraud prevention team efficiency,” said Pablo de la Riva, CEO, buguroo. “We’re excited to be able to offer a proactive approach to fraud prevention that is automatic, flexible, and scalable, and that will make a real difference in eliminating fraud and protecting financial institutions and ultimately the consumers they serve.”

Nuggets and LexisNexis pitch SSI for banks and financial institutions

Nuggets has partnered with LexisNexis to deliver self-sovereign identity (SSI) solutions to banks and other financial institutions, according to a company announcement.

Adopting SSI fundamentally shifts the way personal data is owned, shared and controlled in favor of the user, according to the press release, and is also designed to protect organizations against the cost of privacy breaches, while giving them faster processing and reducing compliance cost.

Nuggets has a technology partnership with Onfido to secure its blockchain payment and identity solution with face biometrics.

“Effective solutions that can digitally identify and authenticate a person more quickly, more accurately and more securely, can have wide-ranging benefits for individuals, organisations and society as a whole, from reducing the time it takes consumers to acquire goods and services, to widening access and reducing fraud and money laundering,” states LexisNexis Risk Solutions MD for the UK and Ireland Steve Elliot. “It’s really exciting to think that innovations like these could help reduce the increasing prevalence of large-scale breaches of consumers’ personal data. We’re really excited to be working with Nuggets to explore how SSI can help achieve those benefits whilst maximising data privacy and security for consumers.”

The companies have been working together since last year, resulting in the joint go-to-market commercial partnership.

ID regulations coming for banks

The problems in identity verification and security that were exposed by the pandemic will result in more regulations that banks must comply with, and facial recognition will be the biggest driver of regulatory change, according to the inaugural OneSpan Global Financial Regulations Report.

The increasing use of biometrics to meet identity verification requirements is leading to the storage of large amounts of consumer biometric data, according to the report. That may lead to the national government adopting the frameworks being developed by NIST and the FIDO Alliance as regulatory requirements.

The report notes that remote bank account opening was approved by regulators in Hong Kong, Pakistan, Greece, Macedonia, Mexico and Turkey during the past year, though the increased use of AI is also under scrutiny. Cryptocurrencies will soon be subject to further regulation as well, OneSpan says.

Open banking is a trend that will drive banks to work increasingly with third-party providers, the report suggests.

According to ‘The Global Covid-19 FinTech Regulatory Rapid Assessment Study’ from the World Bank Group and the Cambridge Centre for Alternative Finance, the most common action taken by regulators to deal with the pandemic that applies to fintechs was in relation to AML and digital identity (49 percent of regulators).

While the majority of regulators have made policy changes to deal with the pandemic, the majority did not specifically target fintech, the report shows.

At least one regulation specifically targeting to fintech was imposed by 37 percent of regulators, many of them in countries with developing economies and related to digital payments and remittances.

Singapore proposes minimal identity verification standard for banks

The Monetary Authority of Singapore (MAS) has published a consultation paper to set out the acceptable methods of customer identity verification financial institutions can use when they are required to perform identity checks, Insurance Business reports.

The MAS proposal would stipulate the use of any one factor among secret information, hardware or software-token generated one-time passwords (OTPs), biometrics, or information shared between the individual and financial institution, to meet identity verification requirements.

Public comments are accepted until December 9.

MAS is also offering SG$35 million (US$26 million) in funding to support the adoption of tools for submitting data to the financial services industry regulator by smaller firms, ZDNet reports.

The Productivity Solutions Grant is meant for banks with 200 or less employees and a local license or registration. The grants are capped at SG$250,000 ($185,000) each, and will pay for services from a pre-approved list of 11 digital technologies from three suppliers, including AxiomSL and KPMG.

Government digital ID program SingPass also now provides a feature for electronically signing legal documents. The Government Technology Agency plans to roll out the service gradually through its Assurity Trusted Solutions subsidiary.

Certificates for signed documents are provided by the National Certification Authority (ATS).

Bank of Thailand expects 40M to sign up for remote biometric authentication

The Bank of Thailand says that 40 million people will sign up for digital ID authentication through the National Digital ID (NDID) program, according to the Bangkok Post. That would be roughly half of the number of deposit accounts in the country.

Customer authenticate themselves on the platform through facial recognition.

The expansion of the NDID platform’s authentication service was announced jointly by the country’s Securities and Exchange Commission, the Office of the Insurance Commission, Electronic Transactions Development Agency (ETDA) and the National Credit Bureau (NCB). The platform will be used to authenticate people for services at 17 financial institutions among commercial banks, asset management firms, insurance companies and non-bank entities.

Digital KYC has been tested by eight banks in a regulatory sandbox.

Australia considers streamlining ID services

An Australian Senate committee has published its interim report on fintech and regtech in the country, as ZDNet writes, with 32 recommendations for the Digital Transformation Agency’s (DTA’s) digital identity initiative and other government projects.

The recommendations for digital ID focus on exploring how the services provided by private sector actors being engaged can streamline government interactions through a single channel, and if KYC obligations can be streamlined with a “rules as code” approach.

Submissions close December 11.

A ‘neo-broking’ service with biometric identity verification is being launched by Jacaranda Finance in Australia, meanwhile, reports Australia Broker.

Jacaranda says the move will make it the first completely online finance brokerage in Australia. The company has operated as a fintech lender in the country for six years.

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