In the age of digital advancements, businesses are constantly under pressure to create safer services for their clients by digitizing their operations. The pandemic has made the world increasingly digital in the quest to find solutions for carrying out tasks during the lockdown periods.
Not only do digitization and security solutions like 2-factor verification make the businesses secure, but a considerable amount of valuable time is also saved.
According to research, around 65% of all e-commerce is done through mobile devices. Online shopping and other kinds of remote businesses that involve financial transactions, all face the threats of cybercrime. Fraudsters generate applications to make customers trust them, they may even present themselves as retailers, service providers, and even mail carriers.
It is crucial to understand the importance of security measures such as 2 factor verification, that should be taken in order to keep fraudsters away from a business. Websites, search engines and social media all keep track of what users do in an online space.
Mobile applications do ask permissions from users, but often access more personal data than the person wishes to share. Online businesses and mobile banking applications also have the features that require users to enter certain information.
Phishing can simply be defined as the stealing of passwords, accounts, and even bank account information by sending fake emails, while appearing to be a legitimate source.
In the email there is usually a link, which is purposely sent to trap the user. When clicked, the link redirects the user to another website. That website, sometimes made by the cybercriminals, asks the user to enter information or credentials. If any of the employees of an organization enter the information, the customer’s information can be accessed, stolen or used for criminal activities.
In this type of phishing attack, the account of one of the employees is hacked by the attacker, followed by them impersonating the respective organizations’ owner and sending emails that seem legitimate. Many businesses become the victim of this kind of criminal attack.
In order to provide security to the customers and make them trust the system, businesses implement 2 factor verification. Integrating these procedures into their system makes it secure and also increases it’s worth in the market.
KYC 2 factor verification provides a countermeasure for financial frauds in digital spaces. Law enforcers have made it mandatory for all organizations dealing with finances to implement KYC solutions in their systems. The procedure simply requires a selfie and works using biometrics and AI to cross check the captured details against secure data in records.
The basic thing is to identify the customer, and check their records for unusual activities. A common red flag are the people with political connections and those with records that relate, in some way, to terrorist financing.
CDD is the commonly used process for regular customers. It involves going through the customers’ past records and checking the potential risk associated. Suspicious records are those which have traces of money laundering and sudden shifting between accounts.
In certain scenarios, the customer is identified to be a high risk person. In these cases, the authorities know for certain that the customer has been involved in money laundering in the past, or has a political background.
2 factor verification is a measure for secure logins, where the user gets an auto-generated code as a text message on his number at each log-in attempt. This method ensures that only the actual user logs in, making it nearly impossible to hack an account. This is because only the user himself is receiving the code.
Using 2 factor verification as part of KYC solutions ensures that only real customers are being involved with the businesses. Client KYC verification reduces risks and allows smooth onboarding, and also keeps the sensitive information safe.
2 factor verification empowers businesses by reducing risks of identity thefts to its customers. But 2 factor verification itself is not enough in the cases where the customer is a high risk person.
In recent years, 2 factor verification has proved to be an effective way of decreasing, if not ending identity frauds and financial crime. Without such security measures, the huge amount of data in online spaces can go in the wrong hands very easily.