Top 10 Identity Verification (IDV) Software & Tools

List of the Best Identity Verification Software

SEON: Identity Verification via Digital Footprint Analysis
Ondato: Live Document Verification
ID.me: Verify Customers for Promotions and Discounts
iDenfy: End-to-End Verification with Risk Scoring
Trulioo: Verify 5 Billion Customers in 195 Countries
Token of Trust: Multiple ID Verification Types
Actico: Identity Verification for Compliance
Onfido: Combining AI and Identity Experts
Jumio: Pioneer in the ID and Selfie Approach
MemberCheck: Compliance and ID Verification

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What Is Identity Verification Software?

Identity verification software is designed to help companies understand who their users are in real life. As it’s easy to create fake identities online, it’s important to confirm that a person is who they say they are. It can also be a legal requirement to meet compliance, privacy, and anti-fraud regulations.

Top Identity Verification Software Features

Still confused about what makes good identity verification software? This list of the best features might help:

Digital footprint analysis: Every user who lands on your site comes with a certain amount of unique data. By enriching that data, you can profile them to an astounding degree.
ID selfie video verification: It’s slow and adds friction, but front-facing selfie cameras are increasingly popular for verifying IDs.
Biometric identification: Looking at users’ unique physical features is a good way to ensure you aren’t dealing with a fraudster. While the technology can still be hit and miss, it is increasingly popular.
Blockchain KYC: The latest technique for verifying IDs. It’s still in the experimental phase, but using blockchain technology to store IDs is proving effective and reliable.

The 10 Best Identity Verification Software

Some of the software solutions below are excellent at verifying documents. Others offer complementary insights to boost the IDV process. Several will help you comply with regulations. All of the tools we’ve selected are worth considering as standalone or in combination.

SEON delivers end-to-end anti-fraud prevention and passive identity verification with unique social and digital signal intel. Boasting highly granular data and customizable rules, it primarily relies on:

IP fraud scoring
Email and phone analysis
Device fingerprinting
Reverse social and digital platform lookup
Machine learning for risk scoring
Politically Exposed Person (PEP), blacklist, sanctions list, and crime watchlist screening

All the data points are fed through risk rules, which are completely customizable by risk managers. However, it is not only used in fraud prevention. Many companies rely on SEON as a way to credit-check their users with alternative data, identify high-value customers, or filter out junk users before official Know Your Customer (KYC) checks.

Ondato offers photo and live video identity verification with easy integration via a software-as-a-service (SaaS) business model. On top of that, you can choose its facial biometrics modules, as well as e-signature and compliance management tools.

The company provides ID verification for companies in a variety of industries, including General Financing, Swedbank, and NFT Venture. Best of all, Ondato meets compliance requirements for financial institutions, so you can use it for KYC and AML in finance, for example.

ID.me is a US-based identity proofing and group affiliation verification vendor that also meets the federal standards for consumer authentication.

What this company does differently involves reaching out to consumers to promote the simplicity of proving their identity online, as well as helping businesses provide marketing promotions and bonuses to verified eligible users. Under the hood, it checks to see whether the customer belongs to an eligible group and triggers an invitation to the promotion.

In fact, the ID.me mission statement stresses “No Identity Left Behind,” promising to enable this functionality to everyone, regardless of background or banked status.

This IDV company started its journey in 2016 when two friends, Domantas Ciulde and Gediminas Ratkevicius, joined forces on a mission to make the online world safer.

Lithuania-based iDenfy is still a budding startup, numbering about 40 employees at the time of writing. However, it has gathered very positive reviews from customers and offers an impressive range of verification products to companies around the world.

These include advanced identity verification that can handle over 2,500 ID documents from 190+ countries, facial recognition, liveness detection, Know Your Business (KYB), AML screening, Near Field Communication (NFC) verification, as well as address and phone verification. Additionally, iDenfy offers proxy detection and fraud scoring capabilities that make use of the data points gathered in the above ways.

Vancouver-based Trulioo is a well-known solution for verifying identities as part of a KYC process. The company also supports business verification for all your due diligence needs.

Their core solutions include identity verification, ID document verification, business verification, and AML watchlist screening. The ID verification system can accept a whopping 11,800 types of official documents across 195 countries, and the GlobalGateway portal can verify 5 billion identities.

Token of Trust was founded in 2015 after its co-founder almost fell victim to an online scam. Compelled to create a better way to protect his identity from fraudsters, he set out on a mission to improve how sensitive consumer information is handled online.

Today, the company offers government ID verification, electronic ID verification, document scanning, biometrics, and even age, address, or social verification.

Its tools are used to onboard, verify, and future-proof businesses, with a special focus on reducing ID fraud and improving compliance – all available via API and even a WordPress plugin.

ACTICO offers identity verification tools with a focus on compliance, as well as underwriting risk and fraud prevention. It serves a number of renowned financial institutions such as Santander, ING, and Volkswagen Financial Services.

Its functions for KYC include risk classification, sanctions, and PEP screening for AML, and KYC profiling, including information on the business relationship and beneficial owner. The company also offers full digital transformation services and credit risk management.

Trusted by companies such as Revolut, Remitly, and Bitstamp, Onfido offers ID verification for digitization, customer acquisition, fraud, and compliance. It uses a combination of biometrics and document verification that covers 2,500 kinds of forms of IDs from 195 countries.

The biometrics analysis combines liveness verification (video selfie verification), and all the data points are processed via machine learning, with possible manual review by human agents.

Leveraging 10 years of real-world production data and hundreds of domain-specific data points, Jumio prides itself on automating identity verification for companies such as Monzo, HSBC, and United, among others.

Their Jumio KYX platform is designed to offer the best customer experience when onboarding a new service. It can analyze 5,000 document types from more than 200 countries and offers bank-grade security and compliance features.

MemberCheck, founded in 2008, has always strived to help organizations meet their compliance obligations. A key selling point of their solution is to offer online ID verification.

The verification process includes biometric screening using facial recognition and liveness detection, as well as two-factor authentication (2FA) verification via SMS. The process is easy to integrate via RESTful APIs, and you can of course perform all the standard AML checks you might need, such as PEP and sanctions checks.

Why Use Identity Verification Software?

While it is possible to manually verify user information against open source databases, the process is lengthy and resource-heavy. Building a solution on-site is also possible, but expensive and a drain on your development team.

By integrating identity verification from a third-party vendor, you can:

automate the process to scale your operations
let the vendor take care of the updates
instantly benefit from the vendor’s technology

This is why an increasing number of companies purchase identity verification from SaaS companies and either pay monthly, annually, or per verification fees.

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Use Cases for Identity Verification

Identity verification is now performed in one way or another by a growing number of companies. The reasons include:

Know Your Customer: This is a legal requirement for financial institutions and other verticals such as iGaming. Not all companies need to perform KYC checks, but it’s your responsibility to check. According to LexisNexis, US financial services alone pay $25.3B in compliance fines.
Digital credit scoring: Understanding if you’re dealing with the right person is a key part of credit scoring. You don’t want to lend money to a fraudster or someone who cannot repay it.
Online transactions: Linking someone’s identity to their credit card details is the surest way to reduce transaction fraud and stop accepting payments made with stolen cards. This helps lower chargeback rates. It can also be a compliance issue. For instance, under the EU’s Strong Customer Authentication (SCA), requirement.
Anti-money laundering: AML is heavily regulated and may be an important part of your identity verification process. It requires special kinds of checks, such as the ability to scan PEP, Special Interest Person (SIP) and Special Interested Entity) lists, among others. You can explore the best AML software in our writeup too.

IDV and KYC

Identity verification is an important part of the KYC process. It’s the method of establishing that the user is indeed who they say they are and takes place when they first join the service or platform. From there, they will be authenticated the next time they are seen.

Understanding Identity and Credential Verification Methods

While many vendors offer identity verification software, not all of them rely on the same tools to do it. Here are some common features to consider when choosing your identity verification provider:

Document and Video Verification

Some vendors will allow customers to submit photos of official documents, such as passports, ID cards, residency permits, or driving licenses. They also require a selfie ID, usually with a piece of paper showing the application date. This technology is also referred to as liveness detection.

The files are then authenticated through a network of third-party verification services. The process is often referred to as electronic Know Your Customer (eKYC) checks.

There are a few issues with this method: it is high-friction, which means it may frustrate users if the process doesn’t work perfectly. Moreover, some customers may be reticent about submitting their personal documents to a company.

Finally, fraudsters can easily pass the process using stolen ID documents and photoshopped files. It’s also worth noting that deepfakes are increasingly affordable and easy to create, and are often used to fool liveness verification checks.

Biometrics

Biometrics are physical measurements that should be unique to each individual. This may include a fingerprint, face ID, or voice recognition, among others.

It is an increasingly popular method, which is seen as less intrusive than document verification. According to Statista, the biometric technologies market will reach $55.42B by 2027.

Unfortunately, biometrics identification can add friction to the user journey and lead to high rates of false positives.

Behavioral Biometrics

Behavioral biometrics are metrics related to user behavior patterns such as browsing habits, cursor movement, scrolling speed, and even the copy and pasting of values.

A good example would be a system that detects whether a credit card’s CVV or CVC has been pasted into the field rather than typed. This is considered a red flag.

In 2020, for instance, a data leak exposed one of the biggest poker botnet rings ever identified after it played 60,000 sessions on 50 sites and earned up to $3M.

MFA and OTP

Multi factor authentication (MFA) and one-time passwords (OTPs) create short-term passwords that a user receives on a device previously linked to their profile. It is most commonly a smartphone but may also work with personal computers, smartwatches, or tablets. They are sometimes referred to as soft tokens.

verification of password in identity verification solutions

The advantage of MFA and OTP is that it’s inexpensive, easy to use, and relatively low-friction for users.

However, a rise in fraudsters taking control of people’s phones means that if the device falls into the wrong hands, the security of MFA and OTP is compromised.

Digital Footprint Analysis

Digital footprint analysis is an invisible identity verification method that attempts to confirm user identities behind the scenes.

It works by gathering bits of information, such as a phone number or email address, and adding more knowledge from open-source databases, a process known as data enrichment. Some examples of digital footprint analysis tools and the kinds of questions they can help you answer include:

Reverse social media lookup: Does the person have a social media profile? If so, what information can we glean from it?

Phone number analysis: Did they submit a legitimate phone number or one from a virtual SIM? Does it point to a country far from their IP address?
IP analysis: Speaking of IPs, is it from a personal connection? A proxy or VPN? Or maybe a Tor connection?
Device fingerprinting: Is the user connecting with a mobile phone or PC? Are they using emulator software? Have their browser settings been seen before?

While answering only one of these questions may not fully help with identification, it is entirely possible to create a risk profile of each individual. This is called verification with alternative data, and it is fast, low-friction, and increasingly effective for:

filtering out fraudsters
identifying non-existent people
blocking bots
giving additional data for a manual verification

Finding the Best Identity Verification Tool

Identity verification can be complex and overwhelming, especially if you need to meet regulatory requirements. The good news is that there’s a growing number of fantastic SaaS fintech companies that let you integrate ID verification easily and seamlessly.

Of course, not all ID verification software vendors will work for your business needs, which is why it’s important to understand exactly what kind of tools are adapted to you. Hopefully, this guide is a great introduction to the topic.

FAQ

Who needs identity verification software?

Identity verification software is useful for compliance reasons, as well as KYC verification and anti-fraud. It helps you learn who you are dealing with to ensure your business can grow safely.

How does identity verification work?

Identity verification can be performed manually or with specific software. The methods include biometrics, multi-factor authentication, and behavior analytics or alternative data profiling.

What features should I look for in IDV software?

The software you choose depends on your use case. If it’s for AML and KYC, you should be able to check identities against specific watchlists, for example. To reduce fraud, it’s important to leverage alternative data profiling techniques.

How much does identity verification software cost?

Most identity verification software is purchased via monthly subscriptions. You can also pay per API call.

Sources

LexisNexis Risk Solutions: US financial services firms pay $25.3 billion per year in AML compliance costs
Statista: Global biometric system market revenue in 2020 and 2025