Regulated businesses in the financial services sector are wasting hours by processing physical documents for ID checks, according to new research from SmartSearch.

The anti-money laundering specialist surveyed 500 regulated firms in the UK and revealed that three in 10 (30%) firms had claimed it takes up to a week to process hard copy documents. Another 21% of firms suggested it takes more than a week.

According to SmartSearch’s data, using manual verification methods is not only more time-consuming, but also less secure. Despite forged documents becoming increasingly sophisticated, 28% of regulated businesses claimed that using hard copy documents is a more reliable method for establishing ID.

SmartSearch suggested this figure is “particularly concerning” as fraudulent documents are also more frequently being produced, with the research showing that almost half (48%) of respondents had reported a rise in financial crime attempts in the past 12 months.

CEO at SmartSearch, John Dobson, called the process for reviewing a physical document “incredibly inefficient”.

“Requesting a photo of the document, a selfie from the client, waiting for them to send these over. Then checking the two match and reviewing the legitimacy. All this is time that could be better spent,” he said.

“Electronic verification works by using credit reference data, combined with other reliable sources, creating a unique ‘composite digital identity’ which is virtually impossible to fake. The best systems can complete a check in just two seconds.

“The FCA has endorsed the use of electronic verification, and those looking to make the switch should not hesitate. Not only will businesses save time, they will also be contributing to the fight against money laundering.”

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