The CFIT has recently announced an initiative aimed at curbing the escalating fraud rates in the UK through the introduction of a Digital Company ID.
According to Finextra Research, this strategic move could potentially save British businesses billions of pounds annually. According to statistics from the Office for National Statistics, the UK experienced over 1.2 million fraud incidents in 2023, indicating a near-constant threat of fraud every minute.
CFIT’s initiative brings together a diverse coalition of financial crime experts from various sectors, including global financial services, academia, technology hubs, and governmental bodies. This collaborative effort is focused on exploring how the Digital Company ID could serve as a pivotal tool in fraud prevention.
The introduction of Digital Company ID is expected to alleviate regulatory and administrative pressures on businesses, especially small and medium-sized enterprises (SMEs). For financial institutions, this initiative could translate into an annual saving of approximately £1.7bn in compliance costs. More importantly, the ID aims to reduce the £6.8bn annual fraud cost to the UK economy. This reduction will be achieved through enhanced data sharing across the financial ecosystem, disrupting fraud networks and sealing exploitable gaps.
CFIT is advocating for significant regulatory and collaborative actions to implement this technology. Their recommendations include the development and testing of a Digital Company ID prototype with the support of the FCA’s Innovation services, mandating secure data sharing across relevant organisations, and the establishment of a multi-stakeholder taskforce to foster high-value use cases for the Digital Company ID in financial services.
Phalé McMillan, head of financial crime risk management and deputy group MRLO at NatWest, emphasized the critical role of technology in safeguarding the financial system and supporting UK economic growth. “Financial crime is one of the most pressing crimes in the UK, which is why cross-industry collaboration is vital to protect consumers, businesses and the overall economy. The proposed Digital Company ID highlights the role technology plays in protecting the financial system and customers, whilst supporting UK economic growth,” McMillan said.
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