How to Choose Identity Verification Software for Your Business

Let’s face it: knowing who you’re dealing with has never been more important.

Identity verification (IDV) isn’t just about compliance. It’s about trust, operational efficiency, and risk reduction. Whether you're onboarding a new user, delivering a high-value package, or verifying age-restricted purchases, reliable identity verification protects your brand and your bottom line.

Legacy, manual methods of identity verification — unlike modern ID software — are slow, error-prone, and frustrating for both customers and employees. And in a world where cybercrime and fraud are increasingly sophisticated, automation is no longer optional. It’s essential.

The three levels of identity verification

The term identity verification covers a range of methods to confirm someone’s identity. These can be grouped into three escalating levels of assurance:

1. What is on the ID?

ID scanning software extracts data from official identification documents such as driver’s licenses, identity cards, passports, and military IDs. It produces a digital, queryable, and human-readable version of the data.

2. Is the ID real?

ID validation software is used to check the authenticity of an identity document — for instance, detecting fake IDs when selling age-restricted goods.

3. Does the person using the ID own the ID?

Biometrics and other verification techniques (e.g., database checks) confirm that the person presenting the ID is its rightful owner.

Not every use case requires all three levels, but whatever level of assurance you need, a well-designed solution will remove friction while safeguarding against fraud.

What is ID scanning software?

ID scanning software converts printed or encoded data from identity documents into a digital and human-readable format.

Extracting data from different ID formats

To ensure compatibility and performance, a robust solution should support:

1. PDF417 barcode format: Commonly found on the back of US driver's licenses and some national ID cards. It contains encoded data that can be quickly read by a scanner.
2. Machine readable zone (MRZ): Typically found on passports, visas, and many European national identity documents.
3. Visual inspection zone (VIZ): The printed front side of an ID card, found on almost all identity documents. It contains the person’s name, date of birth, and other details in a human-readable format.

Without broad format support, businesses risk operational bottlenecks when encountering different types of IDs.

What is ID validation software?

Beyond data extraction, ID validation software ensures the document is legitimate.

The problem? Fake IDs are harder and harder to detect with the naked eye.

ID validation tools identify tampering, inconsistencies, or forgeries — crucial for reducing fraud and maintaining compliance. Reliable validation also protects personally identifiable information (PII), mitigating risks of data breaches or misuse.

Another benefit of automated ID validation is that it can be built into workflows. For example, a last-mile delivery app can prompt the driver to validate ID and prevent them moving to the next workflow stage until this step is complete. This ensures compliance and creates an audit trail.

Biometrics and other verification techniques

Even after validating an ID, one critical question remains: does it belong to the person presenting it?

Biometric checks (e.g., facial recognition with liveness detection) confirm identity ownership in digital ID validation workflows, adding a vital "proof of presence" layer. Additional checks, such as verifying addresses or cross-referencing databases, may also apply.

Why automated document verification software matters

ID verification technology has become an essential tool for modern retail, travel, and logistics businesses, streamlining processes, reducing risk, and improving efficiency.

While legacy approaches may work to some degree, they’re no longer fit for purpose. Manual ID checks and pen-and-paper workflows slow operations and increase error rates. Employees are not equipped to spot high-quality fake IDs and often face time-consuming data entry tasks.

Automated solutions offer fast, accurate, and reliable data capture, reducing human error and enhancing customer experiences. By streamlining ID verification, your team can deliver better service while reducing both business risk and operational overhead.

Market trends in ID verification software

Since 2020, demand for identity verification tech has surged, driven by rising fraud risks, digital-first user journeys, and tightening data regulations. The market is growing fast (almost 15% CAGR) and expected to double by 2030, with key momentum in sectors like retail, logistics, and travel.

This isn’t just a compliance checkbox anymore — it’s increasingly tied to user experience and operational efficiency.

If you’re thinking about this space, you’re not alone. North America is currently leading adoption, but Asia-Pacific and Europe are also scaling fast. This category is moving quickly, and the right ID software can help you ship smarter, faster, and more confidently.

Choosing the right identity verification software: balancing risk and efficiency

Not all businesses need the same level of identity assurance. Understanding your risk profile helps tailor the right solution:

• High-assurance use cases (e.g., banking, healthcare): Need thorough verification with strong compliance support.
• Speed-sensitive use cases (e.g., retail, logistics, air travel): Prioritize fast, efficient checks without unnecessary friction.

This trade-off directly influences the level of identity verification you need. In banking, anti-money-laundering fines can run into millions of dollars (British bank Monzo were recently fined £21 million). Being sure your customers are exactly who they say they are is critical.

On the other hand, age-verified delivery has a lower (though still real) level of regulatory and reputational risk. It also has high requirements for speed and efficiency.

Key features to evaluate in ID software

Accuracy and document coverage

High accuracy is essential for any ID verification solution. Take these tips into account:

• Look for an ID scanning solution with at least 95% accuracy to minimize errors.
• Critical data fields, such as date of birth and document number, should always have 100% accuracy.
• Identity verification accuracy (i.e. the ability to determine if an ID is fake or real) should be at least 99%.
• Document coverage: The software should support a broad range of ID types, including barcodes, machine-readable zones (MRZs), and visual inspection zones (VIZ). Scandit supports 2,500+ ID documents worldwide.

Speed

Customer-facing scenarios demand near-instant results. Automated ID software should take less than 2 seconds to scan and verify an ID. Scandit delivers results in as little as 1 second, even on low-end devices.

Biometric and other authenticity checks may take longer but can be optimized for minimal delay.

Security

Non-negotiable. Consider:

• Where data is processed (on-device preferred to avoid PII storage)
• Encryption standards
• Anonymization policies
• Data retention policies
• Compliance certifications (e.g., ISO27001)

Scandit is ISO 27001 certified and enables GDPR and CCPA compliance. Our ID scanning and validation solutions process all data on-device. Any transmitted usage data is encrypted and anonymized, no personal data is stored on the device, and data retention is minimized.

Integration

Consider how tightly you want your ID software integrated into your tech stack. Are you happy to send customers off to a workflow maintained by a third party to verify their identities, or do you want to maintain total control of the experience?

Apart from this, consider:

• Platform support: Ensure the solution is compatible with your business's tech stack (e.g., iOS, Android, web-based applications). One pitfall to watch out for here is that not all solutions offer full feature parity across frameworks.
• Open-source: Think very carefully before relying on open source integrations. They present a security risk through lack of updates and code reviews which can lead to vulnerabilities.

Scandit offers:

• Data Capture SDK: Fully customizable SDK for all major platforms and frameworks, designed for businesses that need accurate, fast, and secure scanning for employee apps or consumer applications.
• ID Bolt: A low-code, pre-built solution optimized for B2C website and web apps, ensuring fast deployment and seamless user experiences. Scandit maintains ID Bolt’s components and user journeys — so you never have to worry about implementation details, error handling, or evolving regulations.

Testing, UI, and rollout

Avoid surprises post-deployment and ensure maximum user adoption by thoroughly testing in real-world conditions:

UI and UX best practices

• Make ID software intuitive: Implement haptic feedback, audio notifications, and visual indicators to guide users.
• Avoid alignment-based scanning: The software should automatically detect IDs without requiring perfect positioning.
• Enable automatic ID detection: Users shouldn’t have to toggle between modes for different ID types.
• Provide fallback mechanisms: Handle rare or damaged IDs gracefully instead of outright rejection.

Real-world testing tips

• Use real IDs: Testing with images or vendor-supplied sample IDs may not reflect real-world conditions.
• Test in real-world scenarios: Factors such as glare, lighting variations, and different device qualities can impact scanning performance.
• Test on actual user devices: Not all users will have high-end devices. Ensure scanning remains accurate and fast on lower-end smartphones.
• Pilot deployment: Begin with a small-scale test to assess effectiveness before a full rollout.
• User experience: The software should be easy to use for first-time users without requiring extensive training.

Picking the right ID scanning software solution

It’s clear: you can’t leave ID checks to chance.

If your business has a need to check customer identities, reliable automated identity verification software will help you to conduct checks efficiently, securely, and quickly. Just as importantly, it gives your customers confidence that their data is safe and identity secure.