Digital onboarding appeals to everyone, but a quantum leap is needed in the face of new security risks. INEO is an Italian innovative SMB that has the right technologies.
Autore: Francesco Pignatelli
The potential of AI as a tool for circumventing security checks, even biometric ones, is obvious, so much that the cybersecurity chronicle has already recorded its first striking cases. It is a phenomenon that certainly does not go along with the trend for banks, and other financial institutions, to increasingly adopt forms of automated digital onboarding for their customers.
This possibility exists thanks to the fact that Banca d'Italia has implemented the European Banking Authority's new guidelines on supervision in remote customer onboarding solutions. To summarize and simplify, thanks to the new regulations banks and brokerage firms can now independently design their own remote onboarding processes, also taking advantage of services offered by external providers.
It goes without saying that remotely and digitally verifying a client's identity and reliability is certainly more convenient for everyone, clients and non-clients alike. There is a problem, however, when digital convenience comes at the expense of security. And the risk is there, because the boom in digital onboarding has led to the spread of solutions that do not necessarily have the requirements that financial institutions now need.
It is a matter of technology and expertise, two elements on which a specialized Italian innovative SME - INEO - is now leveraging, but which also has more than a decade of useful experience behind it. In fact, INEO is the new face of Lending Solution, which was founded in 2010 and specializes in anti-fraud and anti-money laundering controls.
It is precisely this specialization that is now making the difference, as CEO and founder Salvatore Mafodda recounts, "Historically, remote identification and onboarding have been linked mainly to digital signatures, and even from a regulatory point of view, the focus was not really on the personal identification part. Today the scenario is different and it is required to ensure for remote identification also high standards in anti-fraud and anti-money laundering controls. We are the first entity in Italy able to do this in a progressive and omnichannel way."
INEO has developed-and patented-its own identification system based on AI functions. Among other things, the system makes it possible to remotely acquire various types of documents, immediately verifying their authenticity, and to compare them with the face of the person who is identifying himself. Active liveness checks come into play at this stage to avoid deepfake risk, as well as other real-time checks of classic PEP/Crime/Sanctions Lists and anti-money laundering/anti-terrorism lists.
Complementing the individual control and verification functions-from face matching to geolocation, from real-time database searching to other digital forensics elements-there is also a second-level, asynchronous "human" service that validates the decisions made by the automated assessment systems.
The important point, however, "is not so much what we do but how we do it," Mafodda emphasizes, "The 'how' is related to how closely our solutions preside over and integrate with the specific onboarding and identification process. Indeed, what acts as a guarantee for a customer is not only the technologies themselves but also, and above all, the way they are applied."
How technologies are optimized over time is also important, because an effective "secure" digital onboarding system is not static. As EBA standards indicate, the system must be flexible and adaptable. It needs to be commensurate with the risks assessed for the process involved-choosing the highest level of "armoring" all the time is not the right way to go-and it needs to be regularly adapted as regulations and especially its level of effectiveness change. If this over time is no longer adequate, action must be taken with the right expertise. "This is an approach we have always followed, now we can implement it for remote digital identification as well," Mafodda says.
Given its history and expertise, it seems perhaps curious that INEO has also chosen the crowdfunding route to grow (the company is on Mamacrowd until Feb. 18 then the capital increase continues but offline until March 31). "We are of course also discussing with industrial entities and investment funds, but in the meantime crowdfunding is a way to team up with professionals and businesses that share our technological challenges," Mafodda explains. In fact, crowdfunding has also been joined by, for example, AI researchers who appreciate INEO technologies and companies that have already used them directly.