Digital ID regtech Veriff nets mega-round and plots metaverse as growth vector

• Insider Intelligence publishes hundreds of insights, charts, and forecasts on the Fintech industry. Learn more about becoming a client.

The news: The Estonia-based digital ID regtech Veriff raised a $100 million Series C at a $1.5 billion valuation after a stellar year of growth.

More on Veriff: The regtech’s AI-powered video solutions tap into surging interest from financial institutions (FIs) for financial crime protection, resulting in strong customer growth in 2021, particularly in the US.

• US digital account opening spiked by 32.3% in 2021 as the pandemic forced customers online.
• And financial crime spiked as nefarious actors seized on the opportunity: Identity fraud increased by 109% during the end of 2020 and start of 2021, per TransUnion.
• FIs are confronting the challenge: Almost 80% of North American FIs said they upped their investments in combating financial crime in 2021, per Compliance Week.
• This has been a boon for digital ID regtechs like Veriff, which reported staggering customer growth of 150% in 2021.
• Veriff said its video-based identity verification solution is more accurate against fraud than picture-based solutions utilized by its competitors, like Onfido.

The digital ID space: Elevated funding levels are not slowing down, testifying to the magnitude of the security threat—but players could find it more challenging to stand out in the future.

• Several digital ID regtechs have scored mega-rounds over the past year, including Socure and Trulioo. We don’t expect investor interest to wane, as financial crime will remain a thorn in FIs’ side for the foreseeable future.
• This demand has sustained several players that have achieved global scale through similar offerings. But it could become more difficult for regtechs to distinguish their offerings.
• Digital ID regtechs will need to hone in on new pockets of growth to sustain their growth figures.
• Veriff’s focus on becoming an identity verification specialist in the metaverse could present one way of standing out as consumer interest in the 3D virtual world soars.
• This could bring in new business from FIs operating in the nascent space, particularly crypto firms that facilitate payments.

Want to read more stories like this one? Here’s how you can gain access:

1. Join other Insider Intelligence clients who receive Fintech forecasts, briefings, charts, and research reports to their inboxes each day. >> Become a Client
2. Explore related topics more in depth. >> Browse Our Coverage

Current subscribers can access the entire Insider Intelligence content archive here.