Thinking of Using Social Data?
Using a social network for verification became popular to reduce signup friction and tie your user’s real world identity to their online identity. Social networks will return limited, user-reported data. However, for many applications such as insurance, lending, sharing economy, and banking, more trusted sources are required and those sources of data cannot be self reported. Regulated sources include credit bureaus, government agencies, and bank records.
Here are some characteristics of the data types and uses.
- Data is reported by a user over time and stored in various databases
- Data may contain errors or false information
- Creating multiple online personas is simple and common
- Data can be changed at will by the user
- Fast way for users to signup on a desktop without having to fill out long forms
- Data is collected from authoritative, regulated sources and maintained in controlled repositories such as financial institutions
- Data is required to be kept up-to-date
- Creating a fake identity is illegal and requires significant effort and takes years of fraudulent activity to look authentic
- Data can only be used for anti-fraud and KYC use cases
When is social data a fit?
Social network verification is a great way to reduce signup friction when the user is on a desktop and the impact of fraud is low. For services that required a higher level of trust, traditional identity verification uses name, date of birth, address, and social security number. With mobile signup flows becoming so common, supporting mobile is now a requirement instead of an advantage. 66% of companies that saw a decrease in customer loyalty over the past year do not have a mobile app. However, it’s not enough to simply offer an app and mobile support, you must optimize the entire customer journey for the unique needs of a mobile user without asking for too much personal information.
As mobile devices have become more common, having the user enter their social network username and password is quite cumbersome on a phone screen. Additionally, for trusted services, asking for personal information and social security number dissuades users. A new alternative that offers both convenience and a high level of user trust is Cognito. Using a name and phone number, you can reduce signup friction and ensure the highest level of trust.