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The shift to the digital world means more and more people undertake activities online, including minors. We have to be aware that the digital space is full of age-restricted products and services. Staying in compliance with regulations related to age-exclusive online platforms is a complex and pressing issue. However, age verification systems are an answer for many industries, without face-to-face interactions.

How is age verification done nowadays?

Doing business online requires new ways to verify client’s identities and check if their age is acceptable for offered goods and services. Online identity verification is a process of checking one’s identity without face-to-face interactions. It’s based on remotely checking if  the person is who they say they are and validating personal information provided by them. They usually contain age verification as well. It is performed by cross-checking the date of birth provided by a user with the provided identity document. The whole process is conducted online with the support of various automated systems such as AI, machine learning, and human intelligence. Also, it may include biometrics solutions such as face recognition software. 

Online identity verification containing date of birth check is the most crucial part of the onboarding process for businesses that offer age-restricted products, services, or content. It is a critical feature to comply with regulations associated with forbidden access for minors. Proper age verification service supports many industries in conducting online activities.

Components of an age verification system

Online identity verification with an age check is the most secure and efficient way for age-exclusive businesses to combat the issues with underage access. It ensures being on top of compliance with different countries’ regulations. Nowadays, it is the only reliable method to verify age with certainty. Age verification systems criteria may vary depending on the nature of the industry and the country in which the business operates. However, the following steps are almost always necessary. 

Submit Date of Birth

The end-user submits details, including name and date of birth, through an online form provided by the operator. Depending on the industry, some other personal information may be required. 

Present Document

The user is then requested to show an identity document such as a government-issued id card, driving license, or passport and submit it for verification. Depending on the verification method, the user may take a photo of the document independently during the process or be guided by a verification specialist. 

Extracting Identity Credentials

The age verification service extracts relevant details like the date of birth and name using optical character recognition (OCR) and performs document authenticity checks. 

Verification and Dispatching Results

Once the verification of the details and document authenticity is completed, the age verification procedure is performed. The end-user is accepted or declined based on the provided age verification criteria.

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Benefits of age verification systems

The Age verification system is crucial for online business in the context of compliance, brand reputation, cybersecurity, and financial prosperity. If overlooked, there may be consequences. To understand why specific rules regarding age-restricted areas are needed, it should be borne in mind that they have been created to protect children in the growing number of e-commerce businesses and entertainment platforms. A fast developing online world with its ease of use by mobile devices and young generations accustomed to enjoying it in full scope has some downsides. It is much easier to buy age-restricted goods such as alcohol and tobacco or encounter sexually explicit content in an online environment. That’s why age verification systems are vital in the online space, just like the need to show an identity document in the offline world.

Compliance with regulations

The law in many countries is catching up with restrictions on online content and age-restricted purchasing. In 2021 the UK started to enforce age verification on websites expected to draw the attention of minors. At the same time, Australia began to test age verification when purchasing alcohol or using gambling services, while France pressured pornography sites to check users’ age efficiently. Enforcement of new standards will urge the digital industries to implement sufficient age verification systems.

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USA

In the US, there are a lot of regulations regarding industries offering age-restricted goods and services. In the case of tobacco products, the federal minimum age for purchasing is 21. It is illegal to sell alcohol to people under 21 based on the underage drinking policy. Businesses face monetary fines and penalties if they disobey. Likewise, gambling and betting are prohibited for people under 18. According to Food and Drug Administration (FDA), businesses offering age-restricted products are legally bound to verify the age of customers. In addition, due to Prevent All Cigarette Trafficking (PACT), the online tobacco industry must have age verification software. Regarding social media, there is a limit age of 13, based on the Children’s Online Privacy Protection Act. 

UK

In the case of purchasing age-restricted goods in the UK, a few bills regulate the area of online retail. It is illegal to sell alcohol and tobacco products to minors under 18 based on Protection From Tobacco Act, blades under the Offensive Weapons Act, and fireworks according to The Pyrotechnic Articles (Safety) Regulations. Also, gambling access is strictly regulated under the Gambling Act. Companies are required to conduct reliable identity verification and age check (minors under 18 are not allowed to access) as a part of client onboarding. 

Europe

The EU is in the process of transforming laws regarding access to age-restricted sites for minors. Still, there are also local legal regulations of member states. As a general rule, access to age-restricted goods, services, and content is prohibited for minors under 18. In Germany, the area is regulated by the Protection of Young Persons Act. Gambling operators need to consider different laws in German states that are highly regulated. Denmark and Italy have developed a process of age check to access gambling sites. NemID and Fiscal Code have been implemented to verify personal information against government databases during onboarding. Nevertheless, the EU has established the euCONSENT program, which monitors online restrictions on age-restricted activities in member states. It can be expected that European law will change, and regulations will be harsher.

Cybersecurity

Age verification systems are broadly connected with cybersecurity. The relation may not be clear at first glance, but failure to verify age correctly has consequences in possible online scams. Minors who gain access to age-restricted sites can cause problems to digital business, its legitimate customers, and of course, themselves. According to Javelin’s report, child identity theft resulted in one billion dollars in losses for American families last year. 

There are two main reasons why it is easier for cybercriminals to use the personal information of underage people. First of all, it takes much more time to detect child identity theft. It may take many years to discover the crime, probably until a child becomes an adult and tries to use their personal data in any way. Secondly, children’s personal data is far more convenient for creating a synthetic identity and using it for criminal activities. The personal information of a child is a clean slate, and there is no financial footprint. That’s why it is simple to use that data and create a fake identity that can’t be cross-checked with financial history because there isn’t any. 

Hence, while children’s presence on the Internet has been growing, age verification systems are more needed than ever to protect them and the digital businesses.

Brand reputation

User experience is one of the most important aspects of every modern business. Convenience is always a key factor.. Competition is high, so if the onboarding process does not fulfill the customer’s expectations, they will probably abandon it and move on to another company. That’s why age verification not only has to be secure but also time-efficient and frictionless. Online platforms must recognize that brand reputation is strictly connected with user experience. 

Corporate social responsibility is also an issue to acknowledge. Protection of minors within businesses operating in age-restricted markets is much needed. Access to age-restricted goods, services, and content may be detrimental to a child’s physical and mental wellbeing.

Financial damage

Lack of a proper age verification systems may lead to financial damage in many ways. First of all, there are monetary fines and penalties due to non-compliance with regulations regarding access for minors. Fines are getting more severe, and law enforcement is more engaged. There is also a risk of mandatory suspension of license and impact on annual fees. Financial losses may be connected to online scams aimed at minors at age-restricted sites. As highlighted before, children are more vulnerable to identity theft, especially on platforms they are not allowed to be on. That is why age-restricted businesses are at financial risk when allowing access to underage users. There is also  liability for “friendly fraud,” which is a chargeback from parents who claim that their child’s purchase was non-consenting. A reliable age verification service can cut down such financial losses for companies.

Main industries that need age verification services

The use of age verification tools has been growing in many online industries. Soon they will be necessary for many more. Keeping that in mind, businesses should be prepared to implement a proper age verification system. 

Social media and dating apps

The growing popularity of social media hasn’t stopped for years. They are still the most prominent online platforms for internet users, particularly minors. According to statistics, there were more than 4.62 billion social media users in January. It corresponds to 58.4% of the global population. Due to the nature of those platforms, it is impossible to control the inappropriate interactions between users. And in many cases, they can be harmful to minors.

Nowadays, the efforts to prevent underage users from signing up on social media and dating platforms are ineffective. Children can easily sidestep the procedures by simply lying about their date of birth. There is high pressure on the industry to tackle this issue. Also, the companies have acted on implementing new policies. For example, Meta has created new measures to protect underage users by changing their accounts into private mode by default. Moreover, they are working on developing an AI whose aim will be to remove minors’ accounts and new solutions to verify peoples’ age. Still, it is not enough, and some lawmakers point out that social media platforms have the resources to restrict access to age-exclusive content efficiently. 

Online gambling and gaming 

The online gambling industry is a high-income sector with popularity on the rise. According to statistics, the business will reach 92.2 billion dollars in 2023. It means that its value will almost double compared to the current size of 59 billion dollars. The market is associated with winning the effortless income for those who know the tricks. However, the gambling landscape is changing. Regulations around it have tightened, trust and security have been put into question, and last but not least social responsibility demands to protect children and teens. Both gambling and gaming have enormous addictive potential, particularly for young users.

The industry must acknowledge the thriving number of underage users captivated by both branches. Compliance with regulations and social responsibility need to be taken into account. Hence, an age verification service is firmly essential for the business.

Marketplaces with age-restricted goods

The Internet offers a wide range of age-exclusive products that are physically delivered to clients and directly negatively impact children’s wellbeing. Marketplaces’ operators cannot rely on delivery services to check the age of customers and are legally obliged to verify if the customer is of age to order their products. Businesses selling tobacco, alcohol, and cannabis goods, face enormous fines, lawsuits, and damage to the brand in case of selling to minors. The whole industry needs to stay strictly in compliance with regulations to not cause any doubts about their place in online operations. Still, the e-cigarettes industry is not regulated enough to efficiently restrict buying options for underage clients. Regardless, it is a matter of time for legislation to catch up.

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How age verification was done in the past

Before the era of digitalization, age checks were performed manually as part of confirming one’s identity. It was based on obtaining personal information from an identity document, such as first and last name and date of birth. The traditional method of age verification has been carried out through face-to-face interactions. However, with the extensive participation of the online world in our lives, it is no longer always possible. 

The Internet has struggled with  age verification systems for years. Parents, child protection agencies, and lawmakers have raised their voices that  new solutions are urgently needed. There have been a few methods for age verification, but none of them were affordable and efficient enough. Hence, the methods listed below became obsolete and a thing of the past. 

Age Gate

Is an age verification method  performed by entering the date of birth or checking an adequate box. There is no confirmation of personal data, it is a self-declaration process, which is easy to bypass by simply lying. It used to be the most common practice in age-restricted digital industries, but it became outdated due to the lack of reliable verification. 

Credit card verification

This process involves entering credit card data, and then the company can place a small charge on the user’s account to verify if it is legitimate. This method is flawed because it assumes that only adults are permitted to have credit cards, which is no longer true. Moreover, underage people may have access to an adult’s credit card and cellphone. 

Mobile provider check

This method uses  mobile providers’ details to verify the age of customers. This process may be unreliable due to the possible registration of a phone number to an adult, when in reality, it is used by a minor. 

Social media analysis

Some companies try to verify the age of customers by analyzing their social media accounts. The process can be time-consuming and may not end with reliable information. Age policies regarding access to social media sites are still often unclear.

How can Fully-Verified help with age verification?

The online world is entering a stage of new solutions for age checks. Current methods are insufficient and easy to bypass. Digital businesses must be prepared for new legislation challenges aimed at protection of underage people. The next step is choosing the right identity verification provider that will be able to conduct age checks effectively. 

Fully-Verified offers two methods of identity verification, which can be customized to suit most age verification needs. 

Live-Verify: The verification takes place on a live video call. The verification specialist, backed by automated algorithms and AI,  guides the user through all the steps.

Self-Verify: User goes through the process independently by following on-screen instructions. The system automatically validates the submitted documents, and on top of that, a verification specialist evaluates the recorded video.

For digital industries operating in age-restricted markets, it is crucial f to strike  the right balance between seamlessness for legitimate users and restricting access for those who should not be using the service. If you wish to outsource your age verification process, Fully-Verified can be your trusted partner.

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Fully-Verified was created as answer to its founders collectively losing over $150 000 to various types of fraud in their eCommerce businesses.