Barley Laing UK MD of Melissa Data Corp, details to SBC audiences that biometric technologies may become the betting’s industry’s remedy, following a year of tough compliance adjustments related to KYC, verification and customer duty enforcements…
In the internet age, consumers demand a fast onboarding experience when signing up to a new service, otherwise, they will head elsewhere. This is no different in the gambling industry with research revealing that 25 percent of gamblers have abandoned opening an account online with a betting provider because it took too long or was too complicated.
The solution to this issue is biometrics – more specifically, biometric technology driven by artificial intelligence (AI) that leverages facial recognition. Proving popular in seamlessly confirming the ID of prospective customers in other heavily regulated industries such as banking, biometrics is now capturing the attention of gaming operators.
This approach is poised to have great impact in the UK, where offering a frictionless process at the account opening stage has been further complicated by new Gambling Commission regulations around know your customer (KYC), particularly age verification. Enforced in May 2019, these new rules have the potential to prolong the onboarding experience.
Delivering fast and effective age confirmation and wider identity verification during onboarding comes down to having access to billions of relevant sources of real-time data from trusted entities. These could come from, for example, a government agency, a credit reporting agency and a utility company. But this is not enough. An additional level of security is needed; this is where biometrics can play a critical role.
After all, what’s to stop a determined underage family member from pretending to be their father or mother and creating an online betting company account using their parent’s ID and bank details? In fact, anyone who has stolen a consumer’s ID and financial information can be game. It can be difficult to stop a wilful thief, hence the need to take the digital verification process a step further to ensure compliance without negatively impacting on the onboarding process and alienating the customer.
So how would biometric technology work in a gambling application? Once the registrant has scanned and provided their primary ID document—with a photo that is checked against trusted data sources in real-time—they then simply upload a selfie which is scrutinised by comparing it with the master ID image via an algorithm in the technology itself. To ensure the reliability of the process, this algorithm can immediately distinguish differences between the selfie and the ID image, including facial hair, makeup, age, hairstyle, skin imperfections, and head position.
Verification doesn’t end here though. An increase in ‘spoofing’ involves fraudsters using creative methods like 2D images and video playback to try to trick facial recognition technology and ‘prove’ they are the person they are impersonating. Ideally, at this stage, biometric technology further delivers liveness checks. Liveness checks aim to confirm eye movement and proof of life to establish that the person is real and not a static image. It also instils additional confidence to the gaming company that the person they are onboarding online is very definitely who they say they are.
With the global online gambling market set to grow to more than $74 billion in revenue by 2023, there’s a lot on the line in terms of market share. Winning gambling firms will deliver a lightning-fast, albeit secure, onboarding experience for customers – all while ensuring compliance with ever-changing regulations. Through biometrics, these firms can tighten the registration process to enhance the customer experience and differentiate themselves from the competition. It’s a win-win.