As technology continues to influence every aspect of our lives, it creates both challenges and opportunities, Sunil Madhu said.
Mr. Madhu is the president and CEO of Socure, a provider of digital identity verification and fraud prevention services. With a proprietary artificial intelligence platform that analyzes vast quantities of online and offline data to verify user identities, Socure’s solutions easily integrate into existing workflows through a simple API call.
Changing consumer behaviors mandate a new approach to understanding them. Millennials, who are a growing percentage of the workforce, are living in the sharing economy where they are comfortable using Uber and not buying cars, using fewer credit cards in favor of debit and living with their parents for longer periods instead of buying homes. Taken together the new patterns mean millennials are not building their credit profiles in the same way of previous generations so you have to track their behavior in different ways, Mr. Madhu explained.
“We employ a very broad and deep set of data we acquire to try and determine if the person being presented to us is really that person. Once we have that data we’re using machine learning and data science techniques to develop models.”
Socure’s machine learning systems can ingest unlimited amounts of data and formulate sophisticated and accurate models, Mr. Madhu said. They’re so detailed Socure can visit a prospective client and guarantee four times better performance than what they get from their current system.
This is important in a global economy where 180 countries do not have a central credit system or one single way to identify their citizens, Mr. Madhu said.
“That’s a huge demographic that cannot be accepted by businesses.”
As transaction verification has become more secure in the EMV era, fraudsters have been forced to back up to a point where they can gain easy entry instead of navigating their way through a cumbersome verification process, Mr. Madhu said. That has led them create to create false identities and steal legitimate ones.
But that is occurring at a time when mobile devices contain increasingly sophisticated sensors that allow fraud prevention companies to use facial, fingerprint and even voice recognition capabilities to safeguard user identities. As mobile commerce frequency increases mobile shoppers will be visiting more sites for the first time and having to prove their identities more frequently. User identities will be bound to their devices so they cannot be stolen and used by others.
Mr. Madhu believes social media networks are an accurate identity verification tool. Because your network vouches for who you are, it is virtually impossible to steal it and impersonate the individual. Because social networks take years to be established, they cannot be spoofed, he said.
Social media networks do have some drawbacks for identity verification, Mr. Madhu cautioned. Networks which continue to assert their rights to user generated data limit its effectiveness. As people become more aware their social media information is used for identity verification they may change their online behavior.
Social media platforms who monetize data have themselves to blame for the Pandora’s box they have created, Mr. Madhu said. Many people now log into different sites using their Facebook or Twitter accounts but are unaware of what they have signed away for the convenience. Clicking that box can mean giving the platform ownership over your data, and this has led to lawsuits from users who have been cut off from accessing their own personal data on some sites.
As more people use more social media sites and machine learning systems improve, it makes the data created on those sites more valuable than ever, Mr. Madhu said. Apps scan multiple social networks to get a detailed profile of a single user. That single user can be compared against millions of demographically similar users to create increasingly accurate probability models based on age, location and income.
And with more of that social media activity taking place on mobile devices, especially in the developing world, the ability to capture their digital exhaust will be increasingly important in the years ahead, Mr. Madhu believes.
“Online social data is the present and future of identity verification,” Mr. Madhu said. “We can use that collective intelligence to monitor fraud and look at behaviors across customers like we couldn’t do nine or ten years ago.
“Today’s name of the game is to understand not only what your customers are doing, but what other customers LIKE yours are doing.”