The freelancing industry is one of the rapidly growing industries that has been fuelled by the digital transformation of the world. However, the freelancing platforms are not free from fraudsters and scammers and require a proper document verification framework to ensure safety for the users. In this blog, we will discuss the problems freelancing platforms face and how document verification can help to eliminate them.
The Growing Freelancing Platforms
According to a study conducted in 2017, up to 57 million Americans are freelancing and it is expected that about half of America’s population will be freelancing by 2027, including full-time and part-time freelancers.
People are giving up on hectic jobs from 9-5 and now demand to work on their own terms. Freelancing platforms have made that possible for them and have opened the gateway to the labor market known as Gig Economy. Modernizing work in any field requries an effective document marketing system, including tools to render PDF in HTML. Since the industries have no boundaries, freelancing platforms are accepted around the world. No matter where they live, freelancers can work from anywhere in the world. They can connect through the internet with anyone and provide their services online.
As the industry is growing, the challenges it is facing are also growing with fraud and other criminal activities being the biggest challenge. Every industry is facing fraud and freelancing platforms are not free from it either. The bad actors are making their way into the industry and making it unsafe for the users and document verification can be a solution to this problem.
The Types of Fraud Freelancing Platform Face
The freelancing fraud can be done from both sides including employers and freelancers. Every employer or freelancer has experienced a scam at least once. These types of frauds tend to cause the victim financial damage and also cause them emotional damage and reduces their productivity level.
The most common type of frauds that exist on freelancing platforms:
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Offsite Payment
The most common scam that targets individuals is the payment scam. Sometimes, the employers request the freelancer for communication and payments offsites. The freelancer, desperate to find some work are eager to impress their employers and end up agreeing to whatever they ask. However, this should be a warning sign for the freelancers that something is amiss if the employer prefers offsite payment methods. The employer can vanish after receiving the work without paying and due to the offsite dealings, the scammer would not be traced by the authorities.
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Milestone Payment
This is the method of payment that allows the employer to pay for the task on a course basis rather than paying at the completion of the whole task. Most freelancing platforms offer this as a way to secure users. This way scammers would not be able to vanish without paying as they have already paid a certain percentage of the money already. This is one of the indicators of the scammers as they will never agree to pay advance through set milestones. This has proven to be one of the biggest scams in the Gig economy.
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Money Laundering
This is one of the major issues that has given major regulatory authorities from around the world quite a worry. Freelancing platforms have paved the way for money launderers to transfer money out of the jurisdiction. The anonymity factor has enabled that even more. The criminals can register on the freelancing platform using fake credentials. They can then pretend to provide services and use the payment to layer the trail of their black money. Sometimes, the launderers use the freelancers as money mules to clean their illicit funds.
Document Verification to Save the Day
Document verification can be the way to verify the identity of all the employers and freelancers on the platform to ensure that no fraudulent activity is taking place. Identity document verification is an AI-powered solution that requires identity document proof from the user before they are registered on the platforms. The identity document checks allow removes the anonymity factor from the platforms and fraudsters are identified. Document verification solution only takes a few seconds to verify the identity of the user and the legit customers do not even have to go through the lengthy verification process. Document verification can assist in making the freelancing platforms more secure.