Biometric Security - The Way Forward to Improve Online Retail Shopping

Amazon, eBay, Ali Baba, and other giants are changing the trends of online shopping. They are making digital platforms a new normal for customers to visit for their retail needs. Online shopping and payments may seem convenient but they are vulnerable to various fraud risks including the exploitation of confidential information. Similarly, synthetic identity fraud is another threat in the e-commerce industry that involves impersonating legitimate buyers and making purchases by using their accounts.

Retail sales reached $26 trillion in 2021, an upsurge of 9.7% from 2020, and are further forecasted to see more growth. Hence, for secure online shopping, e-commerce platforms require biometric security solutions. Read on to know how these IDV services benefit the retail sector. 

Biometric ID Verification -- Proactive Measure for E-Commerce Problems

Online shopping is the most popular trend among the masses due to its features such as reliability, convenience, remote order placing, and hassle-free deliveries. While the retail sector is bringing orders to customers' doorsteps, they are facing a high risk of identity fraud. This later results in failed shipments, additional address correction charges, and chargebacks. Payment scams and camouflaged purchases are more threats that collectively expose retail stores to regulatory scrutiny. 

Legal authorities have made Know Your Customer (KYC) a liability for e-commerce sites to mitigate the digital onboarding of criminals. In order to conceal their funds, fraudsters target retail stores as they lack adequate biometric recognition checks. It becomes easier for criminals to flow their illicit funds while making high-value purchases. 

AI-powered biometric screening services provide real-time customer verification by analyzing their distinct biological and behavioral features. Some e-commerce sites offer restricted products such as liquor, tobacco, website membership, and others. This requires such platforms to integrate biometric security systems to ensure customers fall under the age limit.

Compliance with KYC and AML Regulations

Criminals are rapidly adapting to digital transformation while enhancing their capabilities to exploit e-commerce sites. By committing phishing, deepfakes, spoofing, and ransomware attacks, fraudsters target retail stores to exploit legitimate buyers. Moreover, this helps them make purchases by using someone else's payment details. 

E-commerce sites are on the verge of facing a tremendous increase in the flow of illicit funds, identity fraud, and other risks. They need to bring in efficient biometric ID verification as a countermeasure. In order to provide a secure and enhanced customer experience, retail stores need to double their efforts. For this, they should also monitor transactions to ensure they are facilitating criminals in concealing their proceeds of crimes. In this case, biometric security solutions help retail stores prevent criminals by validating payments through facial feature analysis. 

Retail stores failing to comply with KYC/AML regulations will not face serious legal repercussions but also experience reputational damages. In worse scenarios, they will have to pay hefty penalties and can end up under sanctions. On the contrary, AI-powered biometric recognition will mitigate fraudulent onboarding. By deploying real-time analysis and facial feature validation during digital onboarding, these IDV solutions enable e-commerce sites to place preventions for criminals. 

Benefits of Integrating Biometric User Authentication for Retail Stores

Retail stores are integrating advanced technologies such as facial feature recognition, real-time selfie analysis, and others to authenticate customers. Moreover, they help in validating transactions, prevent account takeover fraud, and deter external breaches. Biometric recognition solutions streamlined e-commerce sites' operations by cutting down on additional use of resources. 

AI-powered biometric user authentication enables retail stores to provide customers with a better shopping experience, secure transactions, and hassle-free order placement. Further potencies of these solutions are in the next section:

Reduces Chargeback Claims 

Digital innovations in e-commerce operations are increasing false chargeback claims exposing these sites to huge financial losses. However, by accurately verifying customers and their addresses through real-time biometric screening, retail stores can prevent additional charges. Ultimately, this industry can mark more revenues and restrict fraudsters at the bay.

Prevents Account Takeover Fraud

Despite the services and products, e-commerce sites offer, securing their customers from account takeover is the most crucial task. This type of fraud helps criminals conceal their true selves by using spoofing attempts and bypassing biometric security systems. 

Retail stores can validate transactions to prevent Card Not Present (CNP) and account takeover fraud by integrating biometric recognition systems. These AI-powered IDV solutions map customers' biological features which are impossible to replicate. This way, biometric identity verification ensures buyer making a purchase is an actual account holder.

In Summation

Fraudsters are deploying various strategies to exploit e-commerce sites. These advanced tactics leave retailers with financial and reputational losses while driving legal consequences. In the ever-increasing threat of criminal activities, e-commerce sites should integrate efficient biometric recognition services to draw a line between legitimate buyers and imposters. Furthermore, real-time identification further prevents fraud enabling customers to shop in a more secure environment.