How Does Online Identity Verification Work?

In an increasingly digital world, online identity verification has become crucial to ensuring trust and security in online transactions and interactions. Whether opening a bank account, making an online purchase, or accessing a secure platform, verifying one's identity is essential.

This article will provide a detailed walkthrough of how online identity verification works and cover the various methods and technologies involved in the process.

What is Online Identity Verification, and Why is It Important?

Before diving into the specifics of online identity verification, it's important to understand what it is and why it is necessary.

What is Online Identity Verification?

Online identity verification is a process that confirms the authenticity and legitimacy of an individual's identity in the digital realm. It involves verifying the information users provide against trusted and reliable data sources to ensure they are who they claim to be. This process is crucial in establishing trust and security in online transactions and interactions.

The Importance of Online Identity Verification

Here are some reasons why digital identity verification is important.

Prevents Fraud and Identity Theft

With the increasing prevalence of cybercrime like identity theft, identity farming, and phishing, it is essential to establish trust and ensure that individuals are who they claim to be. By verifying identities, businesses can reduce the risk of fraudulent activities such as creating fake accounts, conducting unauthorized transactions, or stealing personal information.

Digital identity verification is a crucial line of defense against such malicious activities, protecting businesses and users from potential harm.

Enables Secure Transactions

Secure transactions are vital for maintaining trust and ensuring the integrity of online interactions. Digital identity verification enables secure transactions by confirming the identity of individuals involved. It helps to establish a level of confidence that the person on the other end of the transaction is who they claim to be, reducing the risk of fraudulent transactions or unauthorized access to sensitive information.

Compliance with Regulatory Requirements

Various industries are subject to KYC and AML regulatory requirements. For instance, fintechs, lending platforms, healthcare providers, financial services, and other online services are often mandated to adhere to specific regulations to combat money laundering, fraud, and other illegal activities.

Online identity verification helps businesses meet these compliance requirements by verifying the identities of individuals and ensuring that they are not engaging in fraudulent or illegal activities.

How Does the Online Identity Verification Process Work?

Here’s a breakdown of the steps involved in a typical online verification process and the identity verification methods used. Note that the exact process, flow, and digital identity verification methods used can differ between industries and based on the regulatory requirements in consideration.

1. Collection of Personal Information

The first step in digital doidentity verification is the collection of personal information. This can include an individual's name, date of birth, address, and contact details. Businesses often collect this information through online forms in their mobile and web applications.

2. Government Data Collection and Verification

The next step of the verification process involves users providing their government-issued IDs and data for verification. Upon submission, the system verifies this data against a valid government identity database to confirm its validity. Types of government data used at this stage include:

3. Document Verification

At this stage of the verification process, users are required to provide valid identification documents, such as passports, driver's licenses, or national IDs. These documents are typically scanned or photographed using a smartphone’s camera.

Once the documents are submitted, advanced algorithms and optical character recognition (OCR) technology analyze them. OCR technology extracts the document's data, such as name, date of birth, and document number, for further verification. Machine learning algorithms assist in verifying the authenticity of the document by detecting any signs of tampering, forgery, or alteration.

4. Biometric Verification via Selfie and Liveness Check

After verifying the ID document, users need to perform biometric verification by submitting a real-time selfie, video, or both. This stage of the verification process uses liveness detection technology to ensure that a live user is present during verification and not a bot or deepfake.

The facial recognition technology of liveness checks uses various techniques, including geometric analysis, skin texture analysis, and 3D depth analysis, to ensure the authenticity of the selfie or video. These algorithms can detect inconsistencies such as disguise attempts or the use of printed photos, ensuring that the user's face matches the submitted identification document.

To further increase the level of security, some digital identity verification solutions like Dojah prompt users to perform specific actions or movements in front of their cameras to prove their live presence.

5. Address Verification

The address verification process involves the following steps:

User inputs address information: the user provides their address information, such as their street address, city, state, and zip code. Once an address is entered, the verification system parses and formats the data into a standardized format. This ensures that different systems can accurately process the address.
User uploads proof of address document: the user uploads a proof of address document like utility bills and bank statements. The documents must contain the user’s address and must not be over three months old.
Address verification: The system compares the data in the proof of address document with the address data provided to confirm a match. If they match, the system confirms the address as valid.

Seamless and Secure Online Identity Verification With Dojah

Dojah is the all-in-one identity verification, customer onboarding, and fraud detection platform that can help you meet all these needs in one go.

Start verifying your users with ease today. Contact us if you have any questions or schedule a demo session.

Explore our website and documentation to learn more about our product offerings.

Frequently Asked Questions

1. How is identity verified online?

Identities are verified online using methods like:

Biometric verification
Government data verification
Address verification
Documents verification

Businesses rely on the identity verification infrastructure of verification providers like Dojah to seamlessly verify users online.

2. How do I pass my online ID verification?

Here are some tips to help ace the online verification process:

Familiarize yourself with the verification requirements before starting the process
Ensure the personal information you provide is correct, updated, and matches the data on your identity documents. Always double-check for typos and other errors
Make sure your ID documents are valid and not expired
Use a good camera and have a stable Internet connection
Follow the instructions provided in the verification process

3. What three methods are used to verify identity?

Document verification, address verification, and government data verification.

4. How long does a verification of identity last?

The exact duration of the verification process may vary depending on the number of steps and KYC checks involved. However, businesses that verify their customers' identities with Dojah can verify them in 3 minutes or less, leading to a better user experience.