By Simon Horswell, Fraud Specialist, Onfido
In 1995, the world’s first online dating site launched as Match.com, marking a new era for dating. Online dating meant that lonely hearts could connect with potential matches from the comfort of their own home. This convenience leant itself to fast user adoption, and today the dating app market is hugely successful, projected to generate almost $3.01 billion in revenue in 2023.
But new technology often has risks attached. Who is to say the potential match they’re connecting with is who they say they are? This is not a theoretical concern. Analysis suggests that romance scammers exploit over 60 UK singles weekly to commit financial crimes. In fact, a “romance fraudster” was recently jailed for five years for defrauding people via online dating platforms. If digital matchmaking platforms lack the means to protect their users from, the loss of trust could threaten their reputation and their future.
Public awareness of identity fraud has risen thanks to the popularity of true crime depictions, such as the Netflix’s Inventing Anna and The Tinder Swindler. In the UK, these shows have increased consumers’ awareness of their digital footprint, with over half (55 percent) saying they are now more cautious online — but digital dating services cannot afford to rest easy. As fraudsters expand the range of tactics they deploy, the popularization of fraud on our screens may be desensitizing many to the severity of its impact. So much so that almost one-in-five (17 percent) UK consumers are confident they would not fall victim to identity fraud, taking an “it would never happen to me” mentality.
The longevity of digital matchmaking rests upon online platforms keeping their users safe – and this starts with putting identity at the forefront of the experience. As the digital landscape grows in complexity and fraudsters try innovative new ways to scam and scale their operations, trusted apps and services are defined by how they approach security. Those searching for a blueprint can start by re-evaluating their Know Your Customer (KYC) process that establishes user’s identities and assess any associated risk.
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A KYC approach to online safety
Identity verification is at the heart of KYC innovation; it supports businesses to ensure the real identity of new users. With KYC frameworks, companies can accurately check account sign-ups, authenticate users, and check against watchlists for associated risks. However, the online dating industry operates without any form of KYC requirement. Identity verification is often decentralized in the industry, meaning it is left to the discretion of each organization or dating app.
Matchmakers can leverage the benefits of KYC to their competitive advantage, emulating its adoption in other markets such as fintech and gaming. These industries automate KYC checks that allow them to onboard and verify new customers and detect fraud while reducing operational costs.
Unlike fintech and gaming, dating apps are not legally required to perform KYC checks. However, for some, it’s about building trust with users and keeping them safe. Matrimony site, Jeevansathi, set an industry precedent in adopting KYC and implementing user identity verification to build a trusted service with a streamlined user onboarding process. Digital-first apps like Cherry have also introduced automated document and biometrics checks to increase safety and speed up user verification.
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Mitigating romance scams / Fortified security without adding friction
The increasing popularity of dating apps opens up new avenues for fraudsters, who often like to hide where there are high volumes. This greater opportunity leads directly to a wider variety of attacks such as impersonation, catfishing, and coercion.
It’s not just dating platforms making changes to address this. Social media giants such as Twitter and Meta’s Facebook have adapted, although some of them learned the hard way. Last year, Twitter set the blueprint of what not to do, when fraudsters seized the opportunity to pay just $8 for Twitter Blue verification and impersonate public figures and global brands, costing companies billions.
In practice, solving this issue requires businesses to monitor a range of ‘signals’ to build trust that a user is legitimate — like device IP, phone number and information from credit databases. But this business-critical information attracts fraudsters too, who expose it through mass data breaches and then sell it on the dark web. This makes layering identity processes crucial to mitigating risk.
For digital matchmakers, proving a connection between a person’s ID and their physical biometrics helps build trust in users’ real identity. Best practice prescribes that document verification should be deployed as the first line of defense. This can weed out amateur fraudsters, who often leave easily identifiable mistakes. As a second layer, biometric verification can help online businesses mitigate against stolen IDs and deter fraudsters who do not want to put their face to a name. Onfido found that the rate of identity fraud can drop by an average of 3.5x when businesses take this layered approach to identity authentication.
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Understanding the biometric advantage
Digital services nurture trust with their customers by prioritizing security, speed and convenience. These all underpin the modern online experience and can provide a competitive edge, boosting user acquisition and loyalty.
In recent years, biometrics has emerged at the heart of this competitive advantage. Today, as many as 43 percent of consumers indicate biometrics is their preferred approach to identity verification. While of those who have previously used a combination of ID checks and biometrics to authenticate themselves, a staggering (91 percent) would do so again. Biometrics offers a visual representation of security, providing reassurance to users not only that businesses have invested in their safety, but that interactions are legitimate and individuals are authenticated.
What’s more, our 2023 Identity Fraud Report revealed that there are 80 percent fewer attacks when faced with a biometric check, as opposed to document verification alone. With fewer fraudsters able to access dating apps and online platforms, these businesses can protect their reputation, grow their user base and provide the peace of mind and confidence that connections are legitimate.
Placing identity at the heart of matchmaking
With identity fraud rates still above pre-pandemic levels, digital dating apps must establish new processes to protect their users and verify that individuals are who they say they are. Under the influence of TV documentaries like The Tinder Swindler, consumers have become more aware of the risks, putting the onus on businesses to build trust and brand reputation but protecting users.
That’s why online businesses must take a proactive approach to protect the hearts — and finances — of customers. By integrating KYC and taking advantage of automation and biometrics, dating apps can provide a seamless user experience, improve fraud prevention and build trust in digital matchmaking, so users can concentrate on their next connection — not their next nightmare.
About the author
Simon Horswell is a Fraud Specialist Manager at Onfido.
DISCLAIMER: Biometric Update’s Industry Insights are submitted content. The views expressed in this post are that of the author, and don’t necessarily reflect the views of Biometric Update.
Article Topics
biometrics | digital identity | fraud prevention | identity verification | onboarding | selfie biometrics
