Absa Bank has reached an agreement with the department of home affairs that allows the bank to access the Home Affairs National Identification System (Hanis) in an effort to reduce identity fraud. It has also overhauled its sign-up process, making it paperless, and deployed ATMs that accept cash deposits and clears them instantly.

Alfred Ramosedi, Absa’s managing executive face-to-face channels, says making the sign-up process paperless brings down costs for both the bank and for clients and “increases simplicity”.

Absa hopes its new approach will help combat identity fraud. The vetting process makes this type of fraud far less likely while making the sign-up process considerably quicker for customers.

Prospective customers can now be signed up and get a working ATM card in around 10 minutes, as opposed to the previous 45-minute process.

When a new customer wishes to sign up, their ID is checked under ultraviolet light for security marks and then scanned at high resolution.

The customer is then digitally fingerprinted and these fingerprints are cross-referenced with the Hanis database.

If the verification process is successful the customer is then asked to sign their contract digitally and this can either be e-mailed to the customer or printed if they prefer.

Ramosedi says the bank has had an 83% “hit rate” with the Hanis system. That is, 83 in every 100 queries come back positive. The remaining results are either undecided, in which case other measures are taken to verify the customer’s identity, or there’s a negative result, in which case the police are contacted.

Though Absa has a dedicated line between its backend systems and home affairs, it can only access ID and fingerprint information and does not have access to additional information like criminal records.

“With around 35% market share, Absa’s branches are extremely busy, especially at month-end. We’re looking to reduce the time customers have to spend in branches,” Ramosedi says.

Absa is piloting the digital sign-up process in 12 branches in Gauteng and KwaZulu-Natal “to test robustness of system and that customers are happy with the process”. Ramosedi says the bank hopes to have the facilities in all branches by March.

Absa has also begun overhauling its ATM network and adding functionality to its machines. All major branches now have ATMs that accept cash deposits and clear them immediately. “There’s no more dealing with envelopes and slips,” says Ramosedi, “just a cash reader”.

These new ATMs are particularly useful in branches like Absa’s Bree Street facility in Johannesburg’s CBD. For security reasons there are only consultants rather than tellers, meaning deposits can only be made via ATM.

Though Absa was the first bank to integrate with the Hanis system, its competitor First National Bank is the first to do so with national coverage. Robert Tsoka, head of marketing at FNB EasyPlan, says FNB now has Hanis facilities in 150 branches around SA, 137 of which are FNB EasyPlan branches.

Tsoka says the project isn’t only aimed at vetting new customers, but also for existing customers looking for additional products. “It’s about protecting existing customers, too,” says Tsoka.

He says FNB expects to see a “significant drop” in fraud in coming months on the back of the project.

Ramosedi says Absa has similar expectations and has already had seven instances where people have attempted to open accounts with fraudulent IDs. — Craig Wilson, TechCentral