Some of the world’s leading finance and tech firms have come together to form a new industry coalition in the UK to fight economic crime through digital verification, the Centre for Finance, Innovation and Technology (CFIT) has announced.
Companies including Amazon Web Services (AWS), A&O Shearman, Barclays, CRIF, Dun & Bradstreet, Ernst & Young, Experian, GLEIF, HSBC, LexisNexis Risk Solutions, Lloyds Bank, Mastercard, Revolut, Santander and Yoti have confirmed their participation in the CFIT-led coalition, in addition to regulators such as the Financial Conduct Authority (FCA) and the Payment Systems Regulator (PSR).
“The FCA is supportive of the new coalition and welcomes collective initiatives toward reducing financial crime,” comments Sheldon Mills, FCA Executive Director.
“Innovation and technology including RegTech have a positive role to play in addressing fraud. Fraud can take a variety of forms and is continuously evolving.
We recognise the need to protect consumers and businesses alike to ensure that the ecosystem is safe and secure, both of which are key to driving economic growth across the UK.”
Together, they will undertake research and testing to find new ways to protect businesses and consumers from fraud, which is estimated to cost the UK economy billions every year.[1]
Digital verification is considered a key step in mitigating economic crime.
An enhanced digital identity for businesses that can be shared and understood across institutions and sectors would help thwart fraudsters and create a more secure economy.
The idea is to provide standardised and verified information about a business that is interoperable with other financial systems for data cross-referencing, enhanced authenticity checks and additional fraud detection tools.
CFIT’s coalition will work together on data-driven research and solutions that will pave the way to making enhanced digital verification a reality.
This work will be informed by Lloyds Bank, NatWest Bank and Monzo, who will collaborate to deliver a proof of concept that tests the impact of a digital corporate ID, including a reduced scope for accounts to be offered to potential criminals.
The final blueprint report with recommendations for how UK institutions could implement a digital verification solution is expected in March 2025.
This new initiative follows the success of CFIT’s inaugural coalition on Open Finance, which demonstrated the potential of data-sharing technology to deliver better financial outcomes for UK consumers and faster, more effective access to finance for SMEs.
An industry-led Taskforce on Open Finance, chaired by CFIT, has identified commercially viable approaches to incentivise businesses to securely share their financial data to the benefit of businesses and consumers.
“Fraud negatively impacts both consumers and businesses, making up 40% of all crime in the UK. This cannot continue,” says Sam Edge, AWS Global Head of Fintech for Startups,.
“Given the pivotal role of digital commerce in the growth of the UK economy, fraud must be effectively countered with industry-led solutions. AWS is committed to delivering, together with the coalition, workable remedies that counter fraud and enable businesses and consumers to trade safely and with confidence.”
[1]UK Finance estimated that around £1.2 billion was stolen from consumers in 2023.
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