Digital onboarding with NFC

With digital onboarding, the data stored on the NFC chip of ID documents can be read. If identification is carried out using an NFC chip, the previously required bank transfer by the customer is no longer necessary.

What is NFC technology?

Near Field Communication (NFC) is not new. The technology has been around since the early 2000s. It is a bidirectional wireless data transfer between two electronic devices. For the data to be exchanged, the two devices must be no more than 10 centimeters apart. That’s why NFC is considered to be particularly secure, since the small distance makes it almost impossible for the data to be intercepted.

NFC in everyday use

Most users are not aware of that: NFC technology is already widely present in everyday life. It is used, for example, in contactless payment with smartphones or credit cards. In addition, NFC technology is also implemented where access and entry control is involved – for example, in hotels, public buildings or at the workplace. Whereas in the beginning a special device was needed to read the data, today almost every smartphone has an NFC reader.

NFC in online identification

Additionally, NFC is also being used for identity verification. Many ID cards, such as the Swiss passport, contain a NFC-chip that stores key personal data, and also biometric data such as a photo and fingerprints. Such e-travel documents are protected by various security mechanisms. For example, with an NFC reader non-governmental users cannot access biometric data, but can only read the data that is also visible on the document.

Contactless payment is just one of many applications in which NFC technology is used today. In order for the two devices to exchange data, they must be within 10 centimeters of each other. This is why the technology is considered particularly secure, as the short distance means that hardly any data can be intercepted.

NFC in online identification

For NFC technology to be used in digital onboarding, it requires not only a smartphone equipped with an NFC reader and an identity document with an NFC chip. It also needs the appropriate legal basis. The Swiss Financial Market Supervisory Authority FINMA has created this legal basis last year with the update of Circular 2016/07. As of June 1, 2021, the reading of the chip of biometric identification documents is now permitted as a security measure for online identification. At the same time, the previously required bank transfer by the customer is no longer necessary if identification is carried out using an NFC chip.

The legal adjustments were decisive for fidentity to be allowed to integrate the NFC reading functionality into the verification process. This gives customers to identify themselves during onboarding using an electronic passport or other identity document equipped with NFC technology.

*Update to FINMA Circular 2016/07 of May 6, 2021

NFC in online identification

… even easier: If the data for identity verification is read out using an NFC chip, the customer no longer needs to make the bank transfer that was previously required for digital onboarding.

… even faster: the data is read contactlessly. This makes the verification process even faster.

… even more secure: data stored on the NFC chip is practically impossible to falsify. In addition, data readout is guaranteed to be error-free.