Chip-Based Biometrics
April 9, 2025
This article highlights the importance of chip-based eMRTDs (electronic Machine-Readable Travel Documents) in combating identity theft and deepfakes.This article explores the evolution of identity proofing techniques, highlighting the shift from traditional in-person verification methods to modern digital solutions. It discusses how technologies like Optical Character Recognition (OCR), Machine-Readable Zone (MRZ) scanning, and biometric data have revolutionized the KYC process, making identity verification faster and more secure. The article also emphasizes the importance of data security and privacy in digital identity proofing to ensure compliance with regulations and maintain customer trust.
Identity Proofing Techniques
Traditional Methods: Physical Documents and In-Person Verification
Historically, identity proofing relied heavily on traditional methods, which typically involved the physical presentation of government-issued identity documents. Customers would present these documents in person to a representative, who would manually verify their authenticity. This verification process often involved inspecting security features, cross-referencing the provided information, and checking the legitimacy of the document.
While effective in ensuring the legitimacy of a person’s identity, traditional methods are time-consuming, costly, and prone to human error. They also require physical presence, making the onboarding process inconvenient and time consuming for customers. In today’s digital world, these traditional methods have been supplemented and, in many cases, replaced by more efficient digital solutions.
Digital Methods: Online Verification with MRZ and Chip-Integrated Passports
Digital identity proofing has revolutionized the KYC process by allowing businesses to verify identities online, eliminating the need for in-person verification. Several digital techniques are used to establish trust and validate identities remotely:
Document Upload and Optical Character Recognition (OCR)
Customers are asked to upload a scanned copy or photo of their identity documents. OCR technology extracts key information (such as name, date of birth, and document number) from the uploaded images and compares it with the data provided by the customer. This process can be automated, allowing for faster verification.
MRZ-Integrated Passports
Machine-Readable Zone (MRZ) technology is commonly found in passports and some ID cards, which store identity data in a standardized format. MRZ scanning allows for rapid and robust extraction of customer information. This technology is particularly useful in online verification processes, where speed and accuracy are essential.
While the MRZ offers convenience and speed, its security limitations require the use of advanced technologies like the MOBILE CHIP SDK, which bridges the gap by using the MRZ as an entry point to access secure chip-based data. This layered approach enhances the security of verifying identity documents, helping to prevent fraud, counterfeiting, and unauthorized access to sensitive personal information.
Read more about why scanning the MRZ alone does not provide sufficient protection against fraud in our article “MRZ in passports“.
FINMA Enables Chip Reading for Online Identification
FINMA, the Swiss Financial Market Supervisory Authority, has updated its guidelines to reflect technological advancements in online identification processes. A significant change is the introduction of chip reading from biometric identity documents as a security measure for digital customer onboarding. This update eliminates the need for a bank transfer previously required for identification if the necessary data is read from the chip.
FINMA emphasizes that for digital identity verification to achieve a high level of trust, businesses should use a combination of advanced technologies that secure both the verification process and the data being transferred.
Data Security and Privacy With Digital Methods
As businesses increasingly adopt digital methods for identity proofing, data security and privacy are paramount concerns. Handling sensitive personal information, such as passport numbers, biometric data, and other identifiers, requires stringent security measures to prevent data breaches and unauthorized access.
Key Security Considerations in Digital Identity Proofing Include
Encryption: Data must be encrypted both in transit and at rest to prevent interception by malicious actors.
Secure APIs and Platforms: Digital identity proofing should be conducted on secure platforms, with APIs that ensure seamless and safe data exchange between systems.
Compliance With Data Protection Regulations: Businesses must comply with global privacy laws, which governs how personal data should be collected, stored, and processed.
Data Minimization: Only the necessary data should be collected for identity proofing, reducing the risk of exposure, and ensuring customer privacy.
Identity Proofing Techniques – Conclusion and Outlook
In conclusion, identity proofing techniques have evolved from traditional in-person methods to advanced digital solutions that leverage biometric data, MRZ and chip-integrated passports, and secure online verification methods. While digital methods offer efficiency and scalability, they also require robust security measures to protect personal data and maintain customer trust. The MOBILE CHIP SDK verifies identity documents and can be used as part of the KYC process according to FINMA standards.
Learn more on Identity Proofing Techniques
More articles in our series “Mastering KYC Verification”
