The postal address is one of the most commonly used and dependable ways we can prove our identity when applying for new products or services today. The email address could also be one of the ways we prove our identity in the future. Let’s explore that thought a bit more…
Post codes were rolled out in the United Kingdom from 1959 and today there are nearly 2 million of them covering the 29 million UK addresses
A fixed address has been a cornerstone of identity verification since checks began, but increasing numbers of people are opting out of paper copies of bills and bank statements. Fewer and fewer are also registering on centralised databases. This makes it harder for customers to provide the paper copies often required when trying to open a new account, or for them to be checked against traditional operational processes.
Fraud trend research from Experian shows we’re seeing more money mules (a person who acts as an intermediary for criminals and criminal organisations). Fraudsters are intercepting post boxes, especially in remote rural properties or houses and flats with shared post areas. Mules, in many cases, are willing to have their identity stolen. They are therefore freely giving legitimate paper documents as a form of identity proof which can give a false positive scenario.
In a fully digital onboarding process, the email address could, and should, be seen as being just as important as a postal address.
An email address, or rather the data behind an email address, is now being used by many proactive businesses to confirm the identity of a person. By doing this type of check it can provide you with access to the identity credentials that sit behind an email address giving an indication of how likely the information that’s been given is legitimate. Not just from the data it contains, but by cleverly understanding behaviours that can give an indicator of the user themselves being genuine or not.
How can an email address be used to tell us more about a potential customer?
Data contained within an email address is not dissimilar to that of any digital data point. It is built up on various components of data that gives it an identity of its own. For example, data contained within an email address includes the user’s name, the IP address (which for those who don’t know is the unique address of where the digital interaction took place), location, domain, the age of the email, and other useful features. These are valuable assets for various reasons. One, being fraud prevention and detection. You can see from analysing the email address if there is any risk attributed to that email. For example, any historic links for fraud. The great thing is, the data from an email can be used, and combined, to create an email risk score. Another indication of any potential risk that you can then consider further as part of the process.
We are seeing the email risk score become more widely adopted across multiple sectors. Banks, financial services, e-commerce and travel companies, for example, are now accessing an email risk score when people apply for a new product or service. How this works is that a score is delivered, in real time (so fast!) between 0 (very low risk) and 1000 (very high risk). This new tool, and new untapped insight, is being used to support account applications, especially where high value transactions are at stake – as well as other situations.
The use of an email address is already showing great promise, with one global ecommerce provider preventing $19m (£14m) of fraud over 12 months using email risk scoring.
For the time being, we won’t see the postal address entirely replaced when carrying out identity checks, but we will see email risk scoring being used as part of a layered approach to protect people against identity-based frauds. And, why wouldn’t we? It makes life so much simpler and puts another obstacle in the way of fraud – protecting you, and your customers – easily and digitally.
You may also find our white paper: the future of identity an interesting read which covers our views of how, we believe, the future will consist of digital identities. Read it here.
 (Source: Experian Data Quality).