Identity Resolution Helps Money Transfer Companies Meet Their Compliance Obligations

Identity Resolution, Name Matching, Record Management, Risk Management

Identity Resolution for Money Transmitters

A New Generation of Money Transfer Companies Needs to Vet Its Customers

World-wide emigration has increased tremendously over the past few decades. As a consequence, remittances, which are money transfers between individuals across national borders, are a very big business. Banks, as well as companies like Western Union, have been the conventional ways of transferring funds internationally, but there’s also a younger generation of money transfer companies – including some of NetOwl’s customers – that focus on serving people, particularly in developing countries, who don’t have access to traditional banks or other conventional financial services.

These newer companies are heavily mobile device-focused and aim to integrate seamlessly with their customers’ digital lives. But they still have to perform certain functions that other financial institutions do:

  • They need to combat fraud by performing due diligence on customers and by complying with Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations
  • They need to verify the designated recipients at the transfer endpoints
  • For their own business purposes, they have to build up as complete and accurate a picture as possible of their customers.

Variations in the Data Cause Problems

Our customers have found that matching customer data can be tricky and so they have come to rely on NetOwl for a solution.

For example, person records can vary quite a bit:

  • Initials instead of a full given name (Joachim Bittner vs. Joachim R. Bittner)
  • Nicknames (Eduardo vs. Lalo)
  • Different order of name constituents. For instance, Asian names traditionally place the surname first (e.g., Park), but they frequently occur in the Western order (Park Jae-in vs. Jae-in Park).
  • Surnames with different behavior. For instance, Spanish surnames can be composed of two elements, a paternal and a maternal surname. The latter can be optionally dropped. (Santiago Jimenez Meseguer vs. Santiago Jimenez)
  • Abbreviations in items like addresses:
    • Avenida/Avda. (e.g. Avenida San Pedro 112 vs. Avda. San Pedro 112)
    • West/W
    • Massachusetts/Mass./MA

Identity Resolution Can Help

NetOwl’s Identity Resolution technology (aka Entity Resolution), which uses AI and Machine learning algorithms, recognizes that these variants actually refer to the same entity. It balances recall vs. precision to achieve overall high accuracy for a wide variety of names around the world. In particular:

  • It minimizes incorrect matches that may cause the transaction data of one customer to be mixed with that of another.
  • It also doesn’t miss good matches that would cause the data of one customer to be split up and the money transmitter not having the complete picture of a customer’s data.

Our Customers Needed an Identity Resolution Product That Meets these Key Criteria

The principal requirements for Identity Resolution among money transfer customers have included:

  • Given increased globalization and the diversity of America, Identity Resolution needs to handle diverse names coming from many different countries/ethnicities. It has to go beyond American and European names to handle names from all over the world. It must also handle names written in multiple scripts.
  • Identity resolution needs not only to offer smart multi-ethnicity name matching, as discussed above, but also to intelligently combine different attributes within customer records, such as names, addresses, phone numbers, etc., to achieve state-of-the-art accuracy.
  • Identity Resolution needs to be scalable to handle those situations where high volumes of data need to be matched in real time.
  • Identity Resolution needs to be highly robust to handle 24×7 operations.

In sum, NetOwl’s Identity Resolution successfully addresses the challenges of inconsistent customer data that money transfer companies have to deal with.