Voter ID has the Highest Tamper Rate in KYC fraud at 6.78%

IDfy, India’s leading Integrated Identity platform, in their recently released report on “KYC Risks in Lending'' depicts patterns of fraudulent behaviour during onboarding procedures, after carefully analyzing 80 million data points.

The report highlights that 1 out of every 14 loan applicants attempted to deceive KYC checks and fraud detection systems. 

Out of all the IDs accepted during loan applications, the Voter ID has shown to be forged the most with a 6.78% fraud rate, followed by PAN Cards at 3.84%, and Aadhaar cards at 3.11%. 

The report also highlights that 39% of loan applicants have a mismatch between the name and the ID submitted and 7.6% of borrowers submit photos that fail IDfy’s liveness check. This problem of document tampering and fraud is also widely prevalent in the employment and merchant onboarding space. IDfy conducted field investigations that revealed that a fake employment certificate with complete stubs and tax documents can be produced for as little as INR 20,000. This has helped 14% of loan applicants to lie about their employment status through fake documentation. The report also uncovers that collection emails never reach up to 18% of loan applicants who often utilize disposable email IDs 

Ashok Hariharan, CEO and Co-Founder, IDfy, said, "A career-banker once shared with me that lending risk can be classified in three buckets - ability to repay, willingness to repay and KYC. With up to two million API hits a day, IDfy has a unique vantage point to analyze data patterns and anomalies across these three buckets. The KYC risks report is our attempt to help the industry take a deeper look at managing their risk, combat fraud and achieve regulatory compliance. With a better understanding of the pain points, lenders will be able to adopt the right solutions at the KYC stage itself. We help companies prevent fraud at the source." 

IDfy recently launched IDfy360, which is a low-code journey builder that enables lenders to launch new loan products within 7 days. It allows a plug-n-play of APIs in one platform while keeping consent compliance according to the new DPDP regulations.