Employment Verification - All You Need to Know!

Banks, NBFCs and financial institutions are entitled to the major threat of identity and financial fraud and cheating. Any organization who is into the business of credits and other financial services needs to know their customer in a better way. This has been termed as Know Your Customer or KYC. It is needed for the customer to avoid risks such as load defaults or frauds and cheating.

Banks and NBFCs have to verify their customer’s identity inorder to provide basic banking services. Whenever any lending related services are required,detailed verification of customers is done. All the details shared by the customers need to be properly verified. Apart from the customers, employees are also to be verified. They are highly exposed to the risk of cybercrimes conducted by their employees. 

Importance of Verification of Employment

Cases of cyber crimes, identity thefts, money laundering and accounting frauds are quite familiar in the BFSI sector. Unfortunately for the industry, more than 50 percent of all crimes are estimated to be committed by an insider. So, it is needed due to various internal reasons and also for external growth.

Background Intelligence for a healthy growth

Advanced tech systems in place, regulations for safety measures and educating stakeholders are important to keep the sector healthy. It is more important to ensure that the industry is controlled by an ethical workforce that can be trusted with customers' financial information, for protecting company’s assets and investments and for executing best practices in the sector. 

In the current scenario, background intelligence facilitated by advanced technology, accurate data and lightning speed become critical to build trust and to run business with confidence. The trust disparities faced by the BFSI can be solved through Identity and profile verification.

Why is a Financial BGV Necessary?

As background verification is becoming a regular process in industries including healthcare, banks and financial institutions conduct them at different levels of employees.

Financial background check for employment is vital in the banking industry where sensitive financial and personal data about their customers, stakeholders, and insurers are handled by the staff. The sensitive information includes customers’ financial records, passwords needed for the fund transfer and corporate protocol. It is important for the BFSI industry to be driven by a trusted authentic workforce.  

Eventually safeguard should be strong to ensure the security and reputation of the banking facility. The trust deficit in this specific industry can be solved by adopting pre-emptive measures such as these financial background checks.

Why is Background Check Needed in Banking

3 significant reasons why an employment background verification is essential, especially in the banking industry as part of the customer onboarding process

To Protect Customer Information

Financial entities have access to cash, account details and sensitive documents of all formats. As cyber attacks and data breaches are more common these days, they need to make sure that the customer information remains protected.

By conducting a background verification, they can ensure the potential customers' work history, level of compliance with the banking industry regulations and most importantly income verification.

Therefore background check of customers for financial institutions needs to be assured, else their identity and customers safety are exposed to huge risk and fraud.

To follow the best practices for gaining potential customers

Formalities are strict for obtaining any financial services from the banking facilities. If a financial institution undergoes a  complex and confusing process of onboarding a customer, the new customer must not be potential to their business.

With employment verification service providers such as Digitap, it is easy to ensure the customer has the required eligibility to avail the service.

To serve right suitable customers

Banking facilities are very careful while onboarding their customers. Going through every detail of customer employment records and figuring out the right way to approach them.

By evaluating the customers financial profile through the employment verification process, entities could get to know whether a customer is profitable enough for your business and what could be the other services that you can offer to them.

To provide best customer experience

Employment verification would help fintech institutions to know their customers and serve them better. By looking at their financial data, facilities can decide the level of offerings and how to serve. A customer's collective experience can be an interaction with various touchpoints, a report by Hitachi on Banking customer experience trends in 2023 to watch out for.

It can be done in two ways with or without customer consent. In both ways facilities can make sure that they are not irritating their customers by constantly checking with them and thus provide a better service through the onboarding process.

How is Employment Verification Done in Banking

Bank background check is to make sure that the customers are true about their past employment, professional credentials and financial eligibility. Some banks conduct credit transactions background checks to know about their financial habits and spending patterns.

Before conducting the employment background verification for the banking industry, banking or the financial institute has to give the customer a disclosure form informing them about the consumer report. It is possible even without the intervention of the customer through different methods.

Conclusion

Fortunately tech driven solutions in the market are continuously evolving to make this process simpler, more reliable, and less vulnerable to errors.

Digitap for instance uses AI and Machine Learning technologies for providing employment verification services to banks, NBFCs and fintechs and secure them from any internal or external threats. 

Conducting the background verification process with the least effort from institutions as well as customers. To ultimately help all BFSIs for a seamless customer onboarding and an effective credit underwriting process. 

To learn more about Digitap’s Employment Verification Solution Click here

You can also Book a Demo or write to us at sales@digitap.ai to get started.