Consumers now flock online to do their banking but remotely verifying customers’ IDs is not without its challenges, as fraudsters are becoming increasingly skilled at impersonating legitimate customers. In the latest Digital Identity Tracker, Peter Tilton, senior vice president of Royal Bank of Canada, discusses how using AI-powered ID verification capabilities to open bank accounts through its mobile app.
COVID-19 has changed daily routines around the world as more consumers have had to stay at home, only venturing out into public for necessities. This is leading companies of all kinds to navigate how to reach them remotely. Financial institutions (FIs) are among the entities that are working to securely meet clients where they are through mobile and online channels to complete tasks that would more often be completed in person. The Royal Bank of Canada (RBC) is one such FI that recently rolled out digital government identity verification capabilities, allowing customers to verify their identities using its RBC mobile app.
This was the first product rolled out as part of an omnichannel technology stack the bank spent three years building, according to Peter Tilton, senior vice president of the Toronto, Ontario-based bank that serves 17 million customers in Canada, the U.S. and 34 other countries. The technology is available at bank branches and remotely via mobile and its website.
“It’s a really sophisticated digital asset we are building,” he said. “ID verification, in many ways, is the most interesting first pass at using this technology so that we can build it once and deploy it across this technology.”
Users can scan their IDs with the mobile app, and their personal details are automatically populated into their account profiles and into bank advisers’ computers, essentially creating a connection between the app and the branch. The app uses near-field communication (NFC) for easy data transfers. “With an ePassport, you can tap the chip on the card reader on the phone,” Tilton said. “It sucks all the possible information in real time. Or with a driver’s license or another form of government ID, the scanner uses the camera in real time, populating the information on the adviser’s screen using this … technology. The customers are in complete control [and can see] their information transmitted as the app pre-fills the application for us.”
Supporting The Shift To Remote
RBC temporarily closed some of its branches in mid-March because of COVID-19, leading the bank to accelerate the program with plans to deploy a second additional remote option connecting bank advisers with customers at home.
“This should help with the duration of COVID-19,” Tilton said. “As we shift to a digital world, particularly in times like this, when people are remote and disconnected, we’re trying to use real expertise we have with our human advisers to help out.”
The mobile app’s development progressed relatively smoothly, requiring only a little work on government identities that were “glary.”
“We had to do some fine tuning, turning cameras to get things right … before we deployed to the consumer,” he said.
Banks — like any organizations making sophisticated technology choices — should be careful about the accuracy of vendor-promoted technologies as these third parties are not created equal, according to Tilton. He also added that working with governmental authorities who serve as partners as well as regulators can be a long pathway.
“It’s an important part of the process and can be the long pole in the tent,” he said.
Bank advisers can identify customers remotely by sending an encrypted email, Tilton explained. Customers click on their IDs in the mobile app to receive and complete ID verification processes at home with a high level of security.
“When customers are completing the identification [verification process] at home, they will be taking a selfie, which provides a 3D model map of their face, allowing you to compare it to the info that comes off the passport or the photo that was scanned off the license,” he said. “This is very strong prevention against fraudsters.”
Relying more heavily on the mobile app has improved efficiencies for both RBC and the consumer.
“We’re finding we can process opening new accounts comfortably in five to 10 minutes — the old-fashioned sit-down with an adviser [process] took an average of 44 minutes,” Tilton noted.
Using AI For Onboarding
The RBC app relies on artificial intelligence (AI) to verify clients’ government-issued identification documents against encrypted data found in driver’s licenses. There are templates and patterns set up for every form of government ID, and the AI system is constantly scanning to look for any sort of defects within the format, Tilton explained.
“You might not detect with the human eye, but most driver’s licenses include a format which makes them difficult to counterfeit,” he said. “Artificial intelligence is honed around trying to compare every license it looks at.”
AI can assist with learning from previous scanning to spot any little nuance that might indicate or flag that it is a counterfeit.
Keeping The System Secure
Two-thirds of RBC customers use passports, meaning a fraudster would have to be technically skilled enough to defraud a passport to a very high level to successfully steal a person’s identity, according to Tilton.
“For instance, they would have to crack the encrypted chip and read the chip off the mobile phone using a near-field communication connection. Then they would have to somehow match the selfie and the 3D mapping that’s stored on the chip. That level of fraud would flag not only the concern of the bank, but every border security authority in the world,” he said, claiming the RBC mobile app provides a “very, very secure pattern.”
The system automatically flags the bank’s fraud department if something suspicious occurs within the customer identification process.
“We’ve got sophisticated machine learning, which continually learns from our phone platforms, and we can do things like block accounts and deal with the back office,” Tilton explained. “This is critical for our advisers so [they] no longer … have to worry about whether they’re dealing with counterfeits.”
Another benefit of quick onboarding with the RBC mobile app is that, when visiting branches, it frees up RBC advisers to sit with the customer and talk more about their needs, Tilton noted.
“We’re finding that’s having a big impact, not just in terms of customers opening more products, but also deep engagement with the bank … and they walk out of the branch with the mobile app, so it’s chin up, ready to go in one pass,” he said.
Such solutions may enable advisers to provide services more efficiently and with a deeper level of customer engagement than before they entered the pandemic when RBC reopens its branches and consumers resume visiting locations in-person.