Reducing eCommerce Fraud with Automated Driver’s License Verification


The COVID-19 pandemic has driven significant changes in consumer behavior. As countries implemented quarantine protocols to keep the infection rate down as much as possible, many people transitioned from in-person visits and transactions to digital ones. Ecommerce and online shopping have already been gaining popularity over the years, but usage of digital shopping platforms spiked during the pandemic as consumers stayed at home.

The ACI Worldwide Research has detailed that global retail eCommerce sales achieved 209% revenue growth in April 2020. Consequently, in the US alone, there has been a 110% increase in pure eCommerce orders.

While eCommerce has continued to soar during the quarantine period, fraud is also on the rise. As of April 2021, the Federal Trade Commission recorded about 273,034 COVID-19-related fraud cases, with online shopping as the most reported fraud case.

Criminals are trying to take advantage of today’s e-tailers by using fake identities to create new accounts or using stolen credentials to take over existing accounts, and perform fraudulent transactions, and even report chargebacks. These fraudulent activities can cost online retailers their reputation, customer trust, and revenues.

Therefore, to prevent felonious individuals from infiltrating their systems and exploiting their services, eCommerce platforms must improve their security measures. Online retailers can leverage modern identity verification solutions that leverage mobile biometrics and support identity document authentication.

Ecommerce merchants can use mobile facial biometric verification technology to help them confirm an individual’s claimed identity more efficiently and securely. Such verification solution often requires users to perform a liveness detection test, which requires them to make a gesture such as a turn of the head, a blink, or smile, to verify the presence of a real human being. These liveness features provide customers with a seamless user experience and prevent fraudsters from cheating the system.

E-tailers can further eliminate cybersecurity risks by supplementing their biometric verification procedure with an identity document authentication. They must conduct an automated driver’s license authentication when a customer presents it as a valid document to prove that the credential provided is genuine.

Aside from ensuring security in their operations, eCommerce platforms employing modern identity proofing solutions compliant with FIDO 2.0 standards can also improve their services and meet their customers’ demand for a better user experience. FIDO2 authentication solutions enable users to harness mobile technology for a more streamlined and convenient authentication.

With online shopping becoming the new norm for many, enterprises must improve their security measures against eCommerce fraud. They must replace legacy systems with modern authentication solutions to authenticate the identities of their customers and prove the genuineness of the provided identity credential. For more information, see this infographic by Ipsidy.

Reducing eCommerce Fraud with Automated Driver’s License Verification