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Posted By : Jason Cohen
5/10/2021 12:56 PM

To make your businesses grow, providing high-quality products is no longer the only requirement. As customers gain more power, providing the best experience is also crucial. In case of a slight hitch during their buying journey, customers are likely to shift towards another company. Thus, making your entire sales cycle flawless is equally important. 

Address verification is a key component that helps businesses identify their customers. While verifying addresses might not seem like a very significant part of the process, it has the power to make the entire process more streamlined. With an up-to-date address database, customer records become easier to manage, products are shipped to the right addresses, and criminals using fake information to buy products online are easily detected.

The Benefits of an Updated Address Database

As mentioned above, an address is necessary for accurate customer identification. Inaccurate address information can lead to delivery at the wrong address, missed sales opportunities, frustrated customers, high drop-off rate, damaged loyalty, and a stained brand image. On the other hand, the following benefits can be availed through accurate address collection: 

  • Minimizes losses due to returned shipments and dissatisfied customers 

  • Data obtained through an address verification system can be utilized for effective data analytics 

  • Enhances the brand reputation and customer experiences

  • With an address database, direct marketing activities  Improves the effectiveness of direct marketing becomes possible 

  • Address verification after accurate data collection ensures that the customer is actually who they claim to be, and the information provided is accurate during registration

Why was Address Verification Introduced? 

You might be aware that to grow a business, it needs to scale. To make your business scale, it is necessary to attract new customers and make the onboarding process as convenient as possible. Once customers are attracted to your product, you become eligible to collect customer data. This includes proof of their identity as well as their address. 

To ensure that the information obtained is accurate, verification processes take place. Verification is a technique designed to ascertain that the customer logging in to their account is real and not in fact a bot or a fraudster. By verifying the identity of a customer by validating their full name, address, and date of birth, imposters are successfully weeded out. In case your client is a business, business address verification is required to filter out criminal establishments or terrorist organizations. 

Is Address Verification Mandatory? 

While address verification is not compulsory, KYC practices are. KYC, abbreviated for Know Your Customer, is a procedure that is mandatory for all businesses. During this, proofing activities such as identity and address verification take place. Compliance with KYC is made obligatory by global regulatory authorities such as the Financial Action Task Force (FATF). Failure in doing so results in hefty fines and penalties. 

Instruments Used As An Address Verification Tool

Most businesses implement a combination of verification methods, such as document verification as well as biometric verification. Both of these processes are deemed as highly credible. To verify the customer’s address, employees require documents such as a bank statement or a utility bill as proof of address. 

The document verification process is assisted by biometric technology for verifying customers in real-time. After the documents have been analyzed, format and type have been checked, data has been collected, and verification is successful, customers are onboarded within seconds.  

Which Documents Are Acceptable?

There can be numerous situations where the customer might be required to prove their address. As verification purposes can vary depending on the business need, customers can be asked to provide either one of a residential address, business address, or an international address. here are different situations where the customer might have to prove different addresses. Normally, the valid documents for address verification include rent agreements, bank statements, postal letters, and more.

What needs to be noted here is that for address verification, the documents provided must not be older than 2-3 months. As fraudsters use discarded bills to avail monetary benefits, it is essential that the documents are recent. A comprehensive list of acceptable documents for the verification process includes but are not confined:

  1. Water, gas, electricity, or cable bills

  2. Financial or bank statements A copy of an agreement of lease, signed by both the owner and the occupant

  3. Recent salary receipt and tax invoices 

  4. A recent mortgage statement, which could also be older than 3 months depending on the situation

  5. Official letters to authorities 

  6. Insurance documents

Key Takeaways 

  • For businesses to scale, top-notch customer services are of crucial importance 

  • Address verification procedures are implemented for accurate customer identification and verification

  • KYC compliance requires address verification at the time of account opening or customer onboarding

  • Address verification is done through document validation and biometric authentication 

  • The documents provided must not be older than 3 months 

  • Benefits include accurate identification, lower risk of fraud, detection of false information, and higher customer satisfaction

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