Identity Verification Defined and How Does It Work

Have you ever been asked to flash your driver’s license or provide your fingerprint? If so, you already know quite a bit about an identity verification system.

Companies that deploy identification verification ensure that people are who they say they are before establishing a business relationship with them.

What is identification verification?

Any method used to authenticate identity is a form of identity verification. Techniques vary from simple (looking at your passport) to the sophisticated (photographing the iris of your eye and comparing it to a database).

Some organizations are required to deploy a verification service. For example, financial institutions are accountable to legislation like Know Your Customer. To comply, they must verify a customer's identity and risks before establishing a business relationship.

But many companies see the benefits of verifying identity. For example, rideshare companies might pair with organizations like this one to ensure that borrowers are legitimate people and not spoofed thieves.

How does a verification service work?

Imagine that you work in an industry that requires (or simply wants) to verify customer's identities. How can you do that?

Typically, a two-part process is required.

  1. Baseline: The customer somehow verifies identity, and that information is saved within a database. The customer may walk around with proof (such as a passport), or the customer may always need to tap into the database.
  2. Comparison: The customer wants to do something (like open a bank account). The organization compares what the customer can offer (like a passport or a fingerprint) to a central database.

Multiple identity verification methods exist, including:

  • Document checks. The company looks over some kind of paperwork or placard from the customer and ensures the documents are legitimate. If the document has an image, the customer appears in person and looks like the image on the identification document. Or the customer takes a selfie, and it matches the scanned identification document.
  • Biometrics. The customer provides a fingerprint that matches a database of fingerprints. Iris scans and other forms of biometrics are also available.
  • Knowledge. The person can answer questions that only someone with intimate knowledge would know. Sometimes customers provide the questions and answers in advance. Sometimes the machines scrape questions and answers from the person’s life and ask for verification.
  • Two-factor authentication. The person has a passcode or some other form of identification. But that data is backed up with another source, such as a code to a trusted phone or a biometric scan.

Digital identity verification tools lean on cameras and microphones. A customer may do things like snap a photo of documents or themselves to prove identity.

Should you use identification verification?

As we mentioned, legislation may force you to adopt identity verification. If you work in the financial industry, you must take these steps or face the consequences.

But you may choose to add these steps, even if you're not required to do so. Digital tools could help customers access your products and services even when they can't meet with you in person. And they can help you build up a database of trusted customers that you've double-checked personally.

At Okta, we think all companies should do their part to build a safer digital world. That's why we have a suite of services available for organizations just like yours. Contact us to find out how we can keep you safer.


FinCEN: Know Your Customer Requirements. (February 2016). Harvard Law School.

Rental Car Sharing. BioID.