Digital nomadism is now a part of everyday life for millions of people. However, the ability to work from anywhere requires certain preparation for the accepting country. Not least, it involves the process of identity verification (IDV): from the moment a digital nomad applies for a visa and rents an apartment to the moment they buy strong beverages in a grocery store.
Regula partnered with Sapio Research to survey 750 fraud prevention decision-makers and 750 digital nomads from the US, UK, Germany, Spain, UAE, and Mexico to find out:
How effectively are businesses around the world coming to terms with the digital nomad movement?
What tools do they use to verify the identities of nomads?
How do nomads themselves feel about the IDV processes they have to undergo each time they settle in a new location?
Here’s what we learned.
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The digital nomad lifestyle without the glamor
Contrary to the Instagram-style image often associated with the digital nomad lifestyle, reality paints a different picture. Wherever they go, digital nomads navigate a complex bureaucratic maze and often have to overcome a language barrier. Naturally, they deal with identity verification systems more frequently than an average person does.
Of course, the exact scenarios and their distributions are country-specific. For instance, digital nomads face the need to verify their identity while applying for work permits in the UAE (39%) and the US (36%) more frequently than nomads in other regions. In Mexico, digital nomads tend to apply for insurance (and verify identities in this context) more often than in Germany: 60% vs. 28%.
The young full-time software professional: Portrait of a digital nomad
The majority of travel workers are 25-44 years old. The community comprises roughly an equal number of men (49%) and women (51%).
Interestingly, only 18% of travel workers are freelancers, contrary to stereotypical beliefs about digital nomads. Most (68%) are full-time workers employed in a specific company. Business owners (13%) represent a minority of the community.
Software (12%), Banking, and Education (both 9%) are among the industries where many digital nomads work.
Not all countries are equally well equipped to cater to digital nomads’ needs
When investigating digital nomads’ journey, Regula compiled a list of typical activities requiring them to confirm their identity.
We also compared how smoothly these activities are performed across six locations popular among the digital nomad community: the United States, the United Kingdom, Germany, Spain, the United Arab Emirates, and Mexico.
Through this approach, the survey brought to light a comparative ranking of countries where businesses encounter difficulties in accommodating users who possess foreign identity documents.
|Country||The most frustrating ID verification scenario|
Renting an apartment / room / house - 16%
Applying for new documents - 30%
Conducting financial transactions - 17%
Applying for a visa - 25%
Opening a new bank account - 21%
Buying airline tickets, registering at car-sharing services - 22%
|Country||The most user-friendly ID verification scenario|
Renting a car - 17%
Checking into a hotel - 26%
Checking into a hotel - 21%
Opening a new bank account - 26%
Checking into a hotel - 22%
Checking into a hotel, Opening a new bank account - 22%
Surprisingly, the United States emerged as the most frustrating destination for holders of foreign passports when it comes to identity verification processes. Digital nomads in the US faced difficulties during specific stages, including:
buying airline tickets (22%)
crossing the border (21%)
checking into a hotel/ renting accommodation (19%)
In the second spot, the United Arab Emirates presents its share of hurdles, particularly related to applying for a visa (25%), followed by applying for new documents (18%). Essential arrangements, such as buying airline tickets, checking into a hotel, and filling in medical insurance papers were mentioned by 17% of the nomads surveyed.
At the same time, Germany stands out as a prime example of effective identity verification for foreigners. Despite issues in getting long-term accommodation, the majority of other verification use cases, such as opening a bank account (10%), completing medical insurance paperwork (9%), and activating a new mobile phone or SIM card (7%) are pretty seamless.
Some painful issues for digital nomads aren’t directly related to identity verification
Once a nomad enters a country, they have a ton of formalities to handle within a tight deadline: finding a place to live, getting a bank card to pay bills, buying a local mobile to call friends without burning a hole in their pocket, and more.
The most common issues, however, seem to revolve around validity rather than first-time onboarding anywhere:
Document validity periods (19%). Most identification documents come with expiration dates. When a digital nomad is away from their home country, renewing these documents on time can be problematic.
Providing proof of residency (19%). Digital nomads often lack a fixed residential address, making it hard to furnish traditional proof of residency documents like utility bills or rental agreements.
Inconsistencies in information because of frequently changing locations (18%). Constant travel and changes in location can result in inconsistencies in the information provided during ID verification, potentially causing delays or rejections.
Trust and credibility (18%). Nomads may encounter skepticism or a lack of trust from institutions due to the unconventional nature of their lifestyle and work arrangements.
Naturally, the extent of these challenges differs depending on the country. For instance, while 25% of nomads report struggling with proof of residency in the UAE, only 12% report the same challenge in the UK.
Similarly, while only 14% of nomads based in Spain report any issues with the inconsistencies of changing locations frequently, 28% of UAE-based nomads again cite this as a major challenge. And while only 9% of Germany-based nomads report facing a lack of trust from institutions due to their unconventional lifestyle, it remains a challenge for 26% of US-based nomads.
Also, when asked about their main concerns, digital nomads suggested three major risks they associate with the necessity of identity verification. First of all, they are afraid of losing their IDs or them being stolen. Second, they also worry that, not only can their physical documents be stolen, but their identity data itself is potentially at risk. This explains the third concern about using public Wi-Fi for remote identity verification processes, as they believe it can expose digital nomads to hacking attempts, man-in-the-middle attacks, and other cybersecurity threats.
Turning frustrations into a nomad-friendly scenario
At the heart of the above-mentioned challenges for digital nomads lies an imperfect ID verification flow, with each country and business enforcing its own unique rules, often lacking streamlined processes for foreign document verification.
It’s obvious that organizations can benefit significantly from the rising nomadism trend if they play their cards right. After all, digital nomads are also great consumers at the height of their purchasing power.
Below, we suggest three tips on how each entity could bring the process to a new level, boosting both security and user experience.
TIP #1: Extend the list of supported documents
Regula’s survey also revealed that 35% of nomads complained about limited ID document type support in some apps. To address this issue and create a more inclusive verification process, service providers need to extend the list of supported documents.
By broadening the range of acceptable identification documents, businesses can accommodate a more diverse group of users, including those who possess less common types of ID.
Of course, this is easier said than done. Collecting a vast database of all possible ID variations is a challenge on its own. But being able to regularly and promptly update it brings the task to a whole new level. The issue is that you need a reference template, not only to get a general idea of what a certain document looks like, but to be able to analyze if everything is valid and in the right place.
Fortunately, there are already proven solutions on the market. Regula serves its identity verification solution with an extensive database that comprises over 13,000 identity document templates from all over the world. Given Regula’s strong background in document forensics, it’s the world's most comprehensive collection, and is also well-maintained.
TIP #2: Enable remote identity verification when possible
A lack of remote verification capabilities was a concern for 19% of surveyed nomads. In today's digital age, where mobility is a fundamental part of work and life, the ability to undergo identity verification remotely is crucial.
To address this concern, organizations can work on implementing remote identity verification solutions where possible. This not only enhances convenience, but also aligns with the nomadic lifestyle, allowing individuals to verify their identity while on the move.
Of course, this strategy naturally requires investing considerable resources in the technical side. A world-class remote IDV pipeline consists of five steps aligned with a general “ID plus selfie” framework. They involve:
Collecting accurate identity data
Verifying document authenticity
Using biometrics to bind a document with its presenter
Assessing quality for all submitted images and videos
Conducting liveness checks (for both individuals and their IDs)
The last element of the puzzle—but certainly not the least—is securely handling all this sensitive data.
Luckily, you don’t need to reinvent the wheel here, as there are proven solutions that can cover the whole workflow. Regula is one of the few providers that serves as a one-stop-shop for solving this challenge.
TIP #3: Translate identity verification services into more languages
According to our survey, 70% of digital nomads encountered language barriers or difficulties in understanding the instructions during the verification process, and 16% of them marked this issue as the most frustrating aspect of IDV. To make the verification process more accessible and user-friendly, service providers can and should take steps to localize their identity verification services into a broader range of languages.
By offering multilingual support, businesses can cater to a more diverse user base, making it easier for digital nomads from different linguistic backgrounds to complete the verification process accurately and successfully.
Unlike the two previous strategies, this one is perhaps the one that demands the least resources, as long as you partner with a decent IDV service provider. Despite some natural associated costs, the ability (and willingness) of the IDV provider to offer localization is the most crucial factor to consider. Normally, such investments pay off in no time.
To be continued
This post will be updated with new facts as they become public. Subscribe to stay tuned!