A new report by Juniper Research has found that the implementation of Artificial Intelligence (AI) in identity verification will reduce the average time spent per digital onboarding check by banks from over 11 minutes in 2023, to under 8 minutes in 2028; dropping by 30%.
While this is expected to impact banks globally, Juniper Research in the report said this growth will be driven largely by banks in developing regions where there is rising smartphone penetration.
It noted that as AI becomes increasingly accurate, it reduces the number of identity checks referred to a human agent for review, and the need for ID photos to be retaken.
This decreases the time taken for each verification, as well as the associated costs. The use of AI is also expected to play a key role in protecting against emerging threats, such as synthetic identity fraud.
Digital adoption
The research anticipates that widespread adoption of digital verification within banking, particularly mobile banking, will continue to drive digital onboarding revenue growth.
- “Despite the aforementioned increase in efficiency reducing the cost of each individual digital identity verification check, the growing volume of checks, particularly in developing regions, will offset this. As such, Juniper Research forecasts that total spending for banks will increase from $7.4 billion in 2023 to $9.9 billion in 2028; representing a 34% increase, the report stated.
Growth in developing countries
Commenting on the study, the report author Michael Greenwood explained that:
- “Growth will be particularly strong in developing markets, where rising smartphone penetration is making mobile banking more readily available; driving growth in digital onboarding. To capitalize on this, verification vendors must develop onboarding processes that emphasize checks other than credit scores, such as mobile operator history, in order to maximize viability in emerging regions.”
Nigerian banks and AI
Currently, many Nigerian banks are using AI for machine learning algorithms, customer behaviour analysis, demographics, and data to create more personalized experiences for consumers. Specifically, the use of chatbots for customer service has become a basis of competition among Nigerian banks of late.
Zenith Bank, for instance, has its chatbot called Ziva; Fidelity Bank plc has Ivy, First City Monument Bank named its chatbot Temi, while UBA Group has Leo, an AI-powered Facebook Messenger bot that allows users to perform banking transactions. Access Bank also has Tamada; Heritage Bank has an Octopus chatbot, while Keystone Bank’s chatbot is called Oxygen.
A chatbot is a computer program or an artificial intelligence that conducts a conversation through audio or text.
