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The digital ecosystem has its vulnerability and is battling with threats in a manner never seen before, particularly in the banking, financial services, and insurance (BFSI) sectors. As banking systems have moved online, so has fraud, with fraudsters developing their digital methods of stealing customers’ identities and gaining access to their accounts. There comes a need for risk monitoring mechanisms that can develop a safer digital ecosystem for both banks and their customers. The Reserve Bank of India (RBI) reported over 13,000 bank fraud cases across India, with a total value of ₹302 billion. Risk Monitoring Challenges in the BFSI Industry Identifying Synthetic Identities: Artificially created identities pose a significant risk. Fraudsters manipulate data to create synthetic profiles, making detection challenging. Prevent Account Takeover: Unauthorized access to customer accounts threatens financial stability. Identity scan helps prevent account takeover by validating user identities during transactions. Transaction Laundering Protection: Concealing the origins of illicit funds is a persistent issue. Effective risk monitoring can flag suspicious transactions. Customer Validation: Fraudsters submit falsified documents during transactions. Identity scans verify the legitimacy of the submitted information. What can the BFSI industry do to Monitor Risk with Identity Scan? User information is mapped with the repository and open-web sources. This involves using a unique identifier as a mapping attribute and integrating data signals and public information (such as mobile numbers and email IDs) through APIs. The result of this data gathering and mapping process is available to the banks. It is based on risk-scoring of attributes and identities linked to the user. The bank accesses the database using an API. Data Enrichment for Risk Profiling With advanced AI & ML driven technology, we can run a scan across web & mF repositories to pull out data categorize and interlink, and enrich the data based on the inputs asked. The scanning capabilities can correlate the available public information from open sources and databases to identify a genuine profile from a fraudulent one. As per the risk scores based on a pre-defined rule engine, the report is shared with the brand to decide the next action steps depending on the risk scoring. Enhance Efficiencies Opens source intelligence helps validate the authenticity of customers and automate business processes such as credit card or loan application background verification. Check your loan disbursal and credit card approval decisions, data enrichment, validate with social attributes with database linkages across platforms, gather social proofs for tracing absconding defaulters, only relevant and latest, monitor & track social engagements to ensure they get the best of bank services and do not post negative reviews. Protection from Financial Frauds With transaction laundering protection solution banks can safeguard their reputation by identifying UPI frauds, impersonations, mule accounts, and fraudsters using their services to commit tax frauds and scams. Ai-ML-driven tech and OSINT help banks identify illicit activities that damage banks’ reputations and lead to trust erosion. Benefits of Risk Monitoring with Identity Scan Risk Profiling on Social Parameters: Identity fraud protection solution analyses user profile attributes. It uses AI-ML-driven risk assessment and open-source intelligence (OSINT) to analyze social profiles. This aids clients in comprehending the dangers connected to users. Validate with repository, open and dark webs Scan: Using AI and ML techniques, the program searches the internet and large database for customer profiling. It verifies the identity of customers while adhering to privacy laws and policies. Prompt Action based on reports, alerts, and Insights: Detailed reports with risk assessments and recommendations for next steps are sent to clients. Which helps them to take further action on their end. For instance, major Indian banks improved card issuance and credit limit decisions, based on open-source intelligence. It reduced the possibilities of credit risk, up to approx. 14 %. This demonstrates how robust identity verification processes can provide effective results. The BFSI sector must counter the digital threats with profile risk assessment and proactive monitoring and understand related risks increasingly affecting the BFSI industry and tarnishing its brand reputation. Conclusion The digital payment ecosystem is plagued with financial frauds that question the integrity of the BFSI industry. The Identity fraud protection solution, powered with AI-ML tech, proprietary Open-Source Intelligence (OSINT), data harvesters, and an extensive database repository enables brands to safeguard their brand integrity. Identity verification using social risk parameters creates a safer digital ecosystem where all stakeholders can make informed decisions based on reliable data. Get in touch to learn more about the Identity Scan in BFSI

The entire world is connected online, around 64 percent to be exact. With this, a door of opportunity has opened for businesses across the world. However, with this opportunity comes a responsibility. The businesses are accountable for protecting the consumer’s data safe and providing a seamless experience. However, it is not easy.   With the evolution of the digital landscape, there has been a rapid rise in fraudulent activities. One of them is synthetic identity fraud which costs businesses close to $5 billion in 2024.   Imagine spending months to plan that ideal campaign to attract the desired audience as new customers. And you get new customers as well. However, later you discover that the actual number of real users was much less than the number projected.   Reason?   A major chunk of these new users was fraudulent.   The real concern is that this scenario is not hypothetical anymore. Synthetic identity fraud is a real problem existing in the digital landscape.   What is Synthetic Identity Fraud?      Synthetic identity fraud is a type of deception technique where criminals leverage a combination of fake and real data to create a new identity to defraud one or more businesses. These methods bypass KYC verification checks, abuse brand promotions, and offers, take out line credit, purchase with stolen credit cards, launder money and many more ways.   The synthetic identity is crafted with such precision that it seems credible, which helps to pass the security checks when opening an account or making a purchase. As quoted by Security Magazine, 46% of organizations faced synthetic identity fraud in 2022. It is among one of the fastest-growing forms of identity theft.   What has resulted in the rise of Synthetic Identity Fraud?   The personally identifiable information (PII) like emails and mobile numbers are available on the dark web. This helps fraudsters to create fake identities that are hard to differentiate from real identities.  The biggest black box in identifying synthetic identity fraud is that fraudsters don’t use it just after creating a synthetic identity. Instead, they create the identities and use these for a year or more like a genuine person before committing fraud.       For example, Fraudsters open an account using the synthetic identity for an existing credit card. This helps them to create a credit file and they do all the activities to appear as a genuine ID. Once the trap is set, they leverage it to claim a larger credit line.   Where Synthetic Identities Are Used by Fraudsters?  1. Financial Institutions: The most common way for fraudsters to use synthetic identity is in the banking and lending industries. Before executing the synthetic identities for fraudulent practices, the fraudsters set the trap by creating a good credit history with the financial institutions. The organizations believe that the synthetic identity is genuine, eventually leading to the onboarding and creation of an account created by a fake person.   According to a report by Regula, 26% of banks reported over 100 incidents of identity fraud in 2022. 31% of the banks stated that these incidents have cost them an average of $479,000 and more.   2. Online Marketplaces: There is a loophole in online and eCommerce marketplaces that the fraudsters have identified. To provide a seamless customer experience, they keep fewer checks in place especially when it comes to creating new accounts and making the first purchase.   Fraudsters use synthetic identities to create fake accounts and make high-value purchases to get a chargeback. This results in an increase in the burden of losses for merchants.    Signs to detect and prevent Synthetic Identity Theft?   Some of the hallmark signs that indicate Synthetic identity fraud are:   How do we fight against synthetic identity fraud?   Identity fraud or Synthetic identities are hard to detect due to their sophisticated movements and processes. Therefore, banking institutions and other organizations need to invest in an in-house expert or an external tech partner with the capability of detecting ever-evolving identity scams. To stay ahead of the ever-evolving threats of digital identity organizations need to rely on a solution that can identify beyond the basic attributes of a synthetic identity while maintaining a seamless experience for customers.  Comprehensive Identity Scan solution possesses the capabilities to maximize the detection and prevention of the ever-evolving synthetic identity fraud. Leveraging the power of open-source intelligence our solution helps financial institutions and other organizations deal with identity theft.   Our extensive data harvesters and database repository enable brands to utilize digital user data for identity verifications using social risk parameters.   Protect your business from potential identity scams with us!   Get in touch with our experts for deeper insights. Reach out to learn more!