Africa: Why Digital Identity Verification is on the rise

In Africa, there are a plethora of banking prospects. The area is a “sleeping giant” when it comes to having access to conventional bank accounts, online banking, and reasonably priced financial services. Identity Verification APIs are now providing resolutions to the finance sector with their old customer onboarding woes in Africa.

The World Bank estimates that 57% of Africans still don’t have a bank account of any type, including a mobile money account. According to a recent analysis by BPC and Fincog, this amounts to around 360 million adults in the area and 17% of the world’s unbanked population lacking access to formal financial services.

Many Africans lack official identification cards, making it difficult for people to access banking, education, and healthcare services. This can make it difficult for governments and companies to confirm the identities of their residents and clients.

Only 15 African countries have finished their national cybersecurity strategies for threat monitoring and response, according to a study from the Africa Centre for Strategic Studies, according to South Africa’s Financial Sector Conduct Authority (FSCA), which notes that most of Africa’s banking regulations for digital services are slow to evolve.

Aggressive digital expansion in the Finance Sector

The competitive tech landscape that has contributed to a leapfrogging effect by avoiding conventional channels like landlines and going straight to mobile phones has contributed to the growth of Africa’s technology industry. Over time, this development has made the area an essential market for corporate growth and has sped up the adoption of eBanking and mobile money payment systems.

The high rates of fraud and cyber risks, as well as the dearth of cutting-edge identity verification methods to effectively combat fraudsters, are important obstacles restricting potential in the region.

How Identity Verification helps delivering Financial Services across the continent

Identity verification solutions can help with this problem, bringing huge companies to the area who have been put off by the region’s high levels of fraud and inability to adequately authenticate their clients.

Due to the high levels of corruption and regulatory risk present in some countries in Africa, regulatory screening might be particularly crucial. Businesses and other organisations may safeguard themselves against possible legal and reputational issues and make sure they are conducting their operations legally and ethically by undertaking regulatory screening. These AML/CFT checks may also be included in the process when a user signs up on the platform to determine if it’s a legitimate business registered with a government agency to verify that their clients are performing verification for the proper objectives.

Regulatory Landscape in African Countries

In Africa, there are several methods for conducting regulatory screening, including the use of internet databases, in-person investigation, and professional evaluation. To guarantee that they can undertake complete and efficient regulatory screening in Africa, businesses and other organisations need to collaborate with knowledgeable and trustworthy partners.

Once they have been approved, businesses can integrate into one of the many application programmable interfaces (APIs) that the company has made available to, for example, confirm the legitimacy of bank account information or a government ID provided by a customer who requests access to a credit facility.

Biometrics & Transaction Monitoring

Biometrics technology & Transaction Monitoring endpoints enable HR organisations to carry out background checks and verify possible candidates or merchants to spot anomalous transaction patterns of an employee using a verification software-as-a-service (SaaS) type solution.

For the region to catch up to developed markets like the U.S., where a simple Social Security number (SSN) can allow a business to easily establish an individual’s identity, access their credit score, and track their earnings histories, Digital Identity Verifications can help drive cybersecurity and anti-fraud innovation in the region.

Try IDcentral’s Identity Verification API with AI-based Face Match technology

Request a demo