In Gaming, verifying the user before opening an account is as important as it is in digital banking. Know Your Player is a set of rules and laws that gaming industries are compelled to follow in order to tackle identity theft and cases like cyberbullying. Establishing the identity of a new user or a gamer has become integral to fighting data breaches and account takeovers.
Did you know that the US gaming market is around $100 million?
Not only that, it is predicted that by the end of 2023, there will be around 3 billion active gamers! (SportHiatus)
Therefore, creating a safe space for gamers of all ages is an essential demand of today. To ensure that a couple of authorities like COPPA (Children’s Online Privacy Protection Act) are exhausting themselves to create security in this industry through gaming checks.
What Is Identity Verification?
Identity verification is a process that ensures the data gathered matches and is consistent with data in the local or global databases. It validates the information and finds out if a user is present in any sanction list or previous criminal records. Of course, the intensity of CDD (customer due diligence) varies depending on the risk level of a profile (risk-based approach). This has become a vital part of gaming KYC too for maintaining a protected and secure system for its gamers.
What Is Verification in gaming KYC?
Authentication in gaming KYC refers to validating the information provided by a gamer along with background checks and transaction monitoring. Now you might be wondering why transactions are important for gaming companies.
The answer to that is in-gaming purchases and buying services related to it. For example, Fortnite is a popular game for purchases and a built-in online store.
Fortnite is a massive player in this, it is reported by Sensor Tower that they are able to generate over $1 million every day through purchases! That’s a lot!
Therefore, transaction monitoring is a significant part of gaming checks as well.
Why Digital Gaming Checks Are Needed?
There are a few reasons why it is needed, these can be:
- Combatting Identity Theft
Identity thieves can steal and misuse information provided by gamers. Therefore, before allowing a user to open an account online gaming verification with KYC is important.
- Avoiding Account Takeovers
Around 22% of US adults have fallen victim to this – account takeovers.
It is a form of identity theft that should be eliminated through stricter KYC compliance.
- Preventing Money Laundering
Money laundering is an illegal transfer of money to hide and conceal the illegitimate sources of the transaction. It is done in three steps. Placement, Layering, and Integration. While Fintech was becoming stricter in its verification, money launderers found another way to transfer their black money and mix it with money – gaming. Relatively easier systems to bypass, the launderers found a way by buying gaming services and purchases. Then they used these purchases and converted them to money hiding any trials of laundering. To prevent access to virtual currencies, gaming checks are integral.
- Stopping CyberBullying
Cyberbullying and harassment through live gaming platforms and chats are common. That is why it is essential to restrict adults or suspicious profiles to access games developed for minors or underage.
- Data Protection Of Its Users
Last but not the least, when a gamer saves their data and personal information in the game they are doing it expecting data protection. They are putting trust that the respective company will safely store that information. With the striking rise in data breaches, data protection is the need of the hour!
Who Benefits From online gaming verification with KYC?
The two parties that directly benefit from online gaming verification with KYC are:
- The Gamers (Consumers)
- The Creators (Company)
3 ways it reduces fraud in online gaming
Online gaming verification is assisting in reducing fraud through these three ways:
- Address Validation confirms the geo-location of the user.
- Transaction Monitoring helps analyze the spending behavior of users.
- Rejects Fake Identities that reduce the probability of fraud.
These techniques are proven to reduce fraud in online gaming.
Challenges Of Non-compliance to gaming KYC AML.
In case a business fails to be compliant with gaming KYC AML regulations they are faced with heavy fines and penalties.
- Verification in games is a crucial step in making the gaming experience and purchasing services safe for users.
- Being compliant with gaming KYC AML regulations helps in fighting against all forms of identity theft and money laundering.
- Know Your Player ensures establishing an identity based on authentic and original information after validating it against local or global databases.
- One of the dominating advantages of verification in games is the protection of minors from age-restricted adult content.
- With digitalization and the rise in cybercrime, gaming industries are rigorously investing time and money in effective security systems.