Background Verification - Emerging Trends & their Impact on Businesses
Driven by the need for a seamless onboarding and verification experience, the background verification space is undergoing a significant transformation in recent times. However, it is still plagued by the challenges associated with data insufficiency, stringent data privacy policies, consent-based data collection and compliance with varying regulations & data sources to meet global BGV requirements. As a result, efforts are being made to mitigate these issues by ensuring compliance with Indian and global regulatory bodies & acts. The government of India too has recently passed The Digital Personal Data Protection Bill - 2023 which will apply to the processing of digital personal data within India, where data is collected online or offline and is digitized. This is a good example of how the BGV industry is evolving, with data privacy taking center stage.
Latest Tech Trends
Advanced AI and ML tools have become remarkably adept at analyzing vast datasets, automating tasks and swiftly identifying irregularities/fraudulent patterns, making the verification process more efficient and reliable. Furthermore, biometric authentication methods such as facial recognition and liveness detection are gaining prevalence by significantly enhancing the precision and security of background checks. Additionally, OCR technology is enabling businesses to efficiently extract information from documents like passports, driver’s licenses and academic certificates, rendering them machine-readable for easy and accurate document authentication. Companies equipped with this advanced tech stack can deliver substantial value and take the candidate experience a notch higher, thus setting a high standard right from the start.
Major Growth Drivers
The adoption of background screening services it in e-Commerce, IT, BFSI or manufacturing is a testament to growth opportunities and expansion in India. When Covid-19 brought transformative shifts in workplace dynamics, we witnessed a rise in freelancing, independent contractors and remote employees that spiked the need for digital background verification and onboarding. The growing instances of dual employment, data breaches and decline in productivity further pushed companies to embrace moonlighting checks. Another paradigm shift was the ‘Make in India’ movement which invigorated the manufacturing sector and led to a notable increase in the demand for blue-collar workers, and subsequently, a surge in blue-collar verification services. As a result, government and public sector contracts mandated stringent background verification for contractors and employees, further intensifying the demand. The growth of FinTechs further heightened the demand for employee background screening as the industry relies on a workforce with integrity and financial responsibility. Growing concerns over data protection and security have made background verification imperative to ensure trust and compliance in a highly regulated and sensitive sector.
Companies equipped with advanced tech stack can deliver substantial value and take the candidate experience a notch higher, thus setting a high standard right from the start
Data Security & Privacy in Background Verification
Adhering to stringent data protection regulations, data minimization practices, consent-based data collection and conducting regular security audits are legal and ethical implications to respect privacy. Looking ahead, we can expect the increasing prominence of stringent consent mechanisms for personal and professional data management, meticulously designed to deliver transparency at every step and eliminate possible loopholes. Data privacy can be extended to training own staff on best data security practices and conducting ethical background checks. Establishing transparent processes for data collection and having a strict data protection framework such as ISO-27001:2013 and ISO-9001:2015 compliances, along with an incident response plan for data breaches are also key. These are prerequisites for a reliable and growing background verification company to stand out in a competitive industry while ensuring data privacy.
Going forward, the background verification industry in India is poised for substantial growth due to evolving regulatory shifts, societal demands and digitalization. Also, a confluence of factors such as the rise of consent management practices, data aggregating, identity profiling, and algo-based hiring will also play a crucial role in increasing the demand for background verification in India. With the rising emphasis on data protection and security, we anticipate a push for more robust and transparent frameworks concerning consent-driven data management. Most importantly, an intriguing prospect lies in the increasing global expansion of Indian businesses, potentially giving rise to cross-border background verification, thus fostering international collaborations and standardizing protocols globally.