It is becoming patently clear that financial services are moving in a very specific direction from a technology perspective. The direction is towards Digital Identity, Open Banking, and Open Finance. For example, according to www.openbanking.org.uk there were 771m API calls in August alone in the UK.
Simply put Fintechs and large financial institutions alike, are rapidly moving towards permissioned data sharing at scale. This is happening to varying degrees in virtually every corner of the globe. As this plays out, technology departments or service providers have to ensure that identity theft is addressed so as to ensure data can move securely as intended. This groundswell movement is being driven by a number of things. At its core are open APIs, the Smartphone, various authentication methods such as biometrics or OAuth, new regulations in some countries mandating data sharing, a massive increase in competition driven by the plethora of new Fintech’s mushrooming globally, and consumer demand for more digital services.
South Africa’s regulators are starting to cast a keen eye on Open Finance and government bodies such as the FSCA, SARS, SARB, FIC, NCR and National Treasury have come together under the banner of IFWG (Intergovermental FinTech Working Group) to hold workshops, signal their regulatory positions regarding open finance and drive the conversation.
At Comcorp we provide a number of services that provide API-driven data sharing services and a key component of this service is to ensure that the person wanting to share data is who they say they are. There are hundreds of products offering identity-related services and many, many different use cases when it comes to verifying identity and collecting customer consent. We have quickly had to learn that this is not a one size fits all approach. Each business we interact with has different needs and has different capabilities and attitudes when it comes to adopting technology.
In the past 2 years, we have helped numerous companies solve their customer authentication and consent challenges. We have also learned to adapt very quickly to the variety of needs out there. Whether it be a simple requirement to view a home affairs image (our national population register) that is manually eyeballed, or a sophisticated biometric image match of a selfie to home affairs with liveness detection and the collection of POPI compliant consent. In each case, we have tailored our product to meet our customers’ needs. We have provided solutions for use cases as diverse as:
- Couriers delivering credit cards
- Digital loan products sold online
- Our biometric liveness detection embedded in one of the big 4 banks banking app
- Motor dealers verifying customers
- A credit bureau verifying prospective rental tenants
- Or a credit provider looking to access bank statement or payroll data
Our customers have used our bespoke services to process 1,6m identity transactions in the past 2 years and we have only just scratched the surface.
Permissioned data sharing will change the face of commerce in ways we don’t yet fully comprehend, but change is happening every day, right before our eyes. It opens up so many new and exciting business models. Companies embracing the technology, albeit in bite-sized chunks, are quickly understanding what works and what doesn’t. They are adapting their business models to ensure they are well positioned to access more data and share more data whilst ensuring they don’t expose themselves or their customers to identity theft.
By Paul Moss, CEO Comcorp