HyperVerge: Transforming Digital Verification by Tackling Deepfake Fraud in Indonesia

Company Overview

Flip, a leading fintech company in Indonesia, has emerged as a digital powerhouse with over 12 million users, offering comprehensive financial services including money transfers, e-wallet top-ups, and business remittance solutions. As one of the top five digital wallets in the country, Flip faced a critical challenge that threatened the very foundation of digital financial services: sophisticated identity fraud.

Key Pain Points

1. Digital Identity Fraud in Indonesia: A Growing Crisis for Financial Services

Indonesia’s financial services sector faces an escalating challenge with identity fraud, particularly through sophisticated deepfakes and image injection attacks. This threat is especially critical for digital payment platforms that rely on remote user verification. The rise of deepfake technology and image injection attacks has created a significant security risk for digital financial services in Indonesia. Due to the sophistication of these attacks, some financial institutions have had to revert to manual verification processes.

The proliferation of deepfake and image injection attacks has become a sector-wide challenge, affecting both traditional banks and digital-first financial institutions that rely on digital KYC processes.

Scale of the Problem

We discovered image authentication issues where users could inject fake images, bypassing our security checks. This resulted in a 40-45% false acceptance rate, which is pretty high.

Amranjit Datt

Lead Product Manager, Flip

Financial institutions and payment platforms are experiencing substantial fraud attempts. Flip has been processing between 100,000-150,000 user onboardings monthly, with historical false acceptance rates as high as 40-45% before implementing advanced fraud detection technologies.

Fraud Detection Challenges

• Fraudsters consistently stay one step ahead of internal security teams
• Manual verification processes are time-consuming and error-prone
• Traditional KYC (Know Your Customer) methods are being compromised by advanced techniques like deep fake image injection

Existing fraud detection solutions were inadequate in identifying and preventing sophisticated fraud attempts. The evolving fraud landscape demanded continuous innovation and adaptive security measures to protect financial ecosystems and user trust.

2. Manual Verification Bottlenecks:

The verification process is very painful. We have to ask the operations team to manually eyeball all applications. Manual review is prone to human errors and increases our service level agreement (SLA) for completing the verification.

Amranjit Datt

Lead Product Manager, Flip

The necessity to combat sophisticated identity fraud created significant operational challenges for Flip’s onboarding process. The manual verification approach required operations teams to visually inspect each application, creating multiple pain points:

Operational Impact:

• Resource-intensive manual review processes
• Increased vulnerability to human error in verification
• Stretched operational capacity with 100-150K monthly onboarding requests
• Processing times increased by 3-5% due to manual reviews

Customer Experience Deterioration:

• Verification times extended up to 30 minutes
• Poor user experience during critical first interaction with platform
• Risk of customer drop-offs due to lengthy verification times

The combination of high application volumes, manual review requirements, and increased verification times created an unsustainable situation that impacted both operational efficiency and customer acquisition efforts.

3. Regional contextual limitations

Flip faced a unique challenge with their identity verification system: an inability to accurately verify users wearing hats, which is a common practice in Indonesia’s tropical climate. This technical limitation had significant business implications:

Impact on User Verification:

• The system automatically rejected users wearing hats during the verification process
• This affected approximately 3-4% of potential customers
• The limitation particularly impacted users in Indonesia’s hot, humid climate where hat-wearing is commonplace

This technical constraint created an unnecessary barrier in Flip’s onboarding process, risking the loss of legitimate customers simply due to their normal attire choices suited to local weather conditions. The system’s inability to adapt to regional clothing norms highlighted the need for a more contextually aware verification solution.

HyperVerge’s Solution

Flip selected HyperVerge based on a comprehensive “3P Framework” of Product, Price, and People, with product capabilities being the primary consideration.

Selection Criteria

When identifying partners, I use a 3P framework. The order of importance is critical. First, we evaluate the product to ensure it meets all our requirements. Then, we check reference customers, and market ranking, and conduct our own research.

Sourabh Gupta

SVP Product & Design, Flip

When Flip faced challenges with its existing KYC solution, particularly around liveness checks and injection attack detection, finding the right partner became crucial. As mentioned by the SVP, Product & Design at Flip, Sourabh Gupta, Flip employs a structured “3P framework”—Product, Price, People—for evaluating potential partners.

1. Product Evaluation:
   • Advanced fraud detection capabilities
   • Market reputation
   • Reference customers
   • Comprehensive POC (Proof of Concept)
2. Pricing Considerations:
   • Competitive and feasible pricing model
3. Team Dynamics:
   • Preference for growth-stage product companies for better understanding and mutual commitmentCollaborative and responsive teamPrioritizes long-term relationship potential

What I liked while working with HyperVerge team was, it was kind of an engagement where both the teams like our product teams and HyperVerge product team were working together to figure out how to optimize that model

Sourabh Gupta

SVP Product & Design, Flip

The partnership initiated after meeting at an industry event and progressed through careful evaluation. What set Hyperverge apart was our ability to excel across all three parameters of Flip’s evaluation framework. Our technical capabilities addressed their immediate challenges with liveness checks and injection attacks, while our team’s responsiveness and product expertise aligned with their expectations for a long-term technology partner.

Post-implementation, this approach has proven successful, with Saurabh noting the collaborative optimization between both product teams and improved fraud detection rates while maintaining low false positives. The partnership has since expanded, with ongoing POCs for additional services, validating Flip’s selection process and Hyperverge’s ability to deliver as a strategic partner.

Key Solution Components

• Advanced liveness detection
• Deepfake and image injection prevention
• Rapid identity verification

HyperVerge developed a more nuanced image verification algorithm that:

• Intelligently handles images with headwear
• Maintains robust fraud prevention capabilities
• Provides flexibility without compromising security

The innovative hat detection solution presented a potential increase in successful verification rates by 3-4%, a significant improvement for Flip’s digital onboarding process. The solution masterfully balanced strict verification requirements with user convenience, proving that robust security need not come at the cost of user-friendliness. This approach highlighted HyperVerge’s capacity to provide customized solutions that are sensitive to different market contexts, transforming a potential point of friction into a seamless onboarding experience.

Implementation and Results

Quantifiable Improvements

Fraud Prevention

• False Acceptance Rate: Reduced from 40-45% to essentially 0%
• False Rejection Rate: Approximately 0.5%

Data quoted by Amranjit Datt, Lead Product Manager, Flip

Onboarding Performance

• Onboarding Volume: 100-150K users per month
• SLA Completion: 98% within 30 minutes
• Liveness Check: Completed in under 5 seconds

In the realm of fraud prevention, Flip’s system has achieved remarkable improvements. The number of fraudulent users successfully entering Flip’s system has dropped dramatically – from 40-45% of applications being fraudulent users who could bypass security checks, to almost zero.

Regarding onboarding performance, the system demonstrates exceptional capabilities.

The number of fraudulent users successfully entering Flip’s system has dropped dramatically – from 40-45% of applications being fraudulent users who could bypass security checks, to almost zero. The system now maintains high accuracy, only incorrectly rejecting about 0.5% of legitimate users.

Amranjit Datt

Lead Product Manager, Flip

The liveness check, a critical component of our identity verification process, is completed in under 5 seconds, ensuring both rapid and thorough user authentication.

Technical Capabilities

HyperVerge’s solution offered sophisticated features:

• Advanced selfie liveness detection
• Multi-frame image analysis
• Injection attack prevention
• Deepfake detection

Partnership Highlights

Technical Collaboration

The HyperVerge team came up with solutions based on their experience and insights from partners in Indonesia. They helped us improve our existing Standard Operating Procedures (SOPs).

Amranjit Datt

Lead Product Manager, Flip

What I liked was the engagement where both teams were working together to figure out how to optimize the model

Sourabh Gupta

SVP Product & Design, Flip

Continuous Improvement

An ongoing example of collaborative innovation is the “hat detection” case, where HyperVerge proactively suggested improvements to increase successful user verification rates.

Future Outlook

Potential expanded use cases include:

• Database cleanup
• OCR and ID verification
• Face match solution

Conclusion

The partnership between Flip and HyperVerge demonstrates how advanced AI-driven verification technologies can transform digital onboarding, dramatically reducing fraud while improving user experience.

Key Takeaway: By implementing HyperVerge’s solution, Flip achieved near-zero deepfakes or identity frauds entering the system, streamlined user onboarding, and created a more secure digital financial platform.