Plaid has rolled out significant upgrades to its identity verification (IDV) product to counter the evolving threat of generative AI-enabled fraud.
The enhancements, unveiled in a blog post on 13 May, include new tools designed to detect deepfakes, identify synthetic media, and flag facial duplicates, aiming to stay ahead of increasingly sophisticated digital impersonation tactics, claims PYMNTS.
The updated solution also features age estimation to identify potential impersonation attempts and adaptive, risk-based verification flows. These flows tailor the identity checks in real time — streamlining the process for low-risk users while adding layers of scrutiny for those deemed high-risk. Importantly, Plaid confirmed that these upgrades are available immediately to existing IDV customers with no additional integration required.
The move comes as financial services firms brace for the widespread impact of AI-driven fraud. Fraudsters have begun leveraging generative AI to create convincing fake ID sessions at scale, undermining traditional security checks. “New generative AI models now pop up almost every week, and even unsophisticated fraudsters use them to generate convincing ID verification sessions at scale,” Plaid product marketing manager Danica Kleint and product manager Anthony Sezer wrote. “That shift makes defense-in-depth — layering several independent checks so nothing hinges on a single point of failure — more crucial than ever.”
The need for more robust identity verification tools is underscored by wider industry trends. According to a PYMNTS Intelligence report, 83% of financial institutions are now exploring generative AI to strengthen fraud defences. While AI has enabled bad actors to scale fraud via deepfake videos, synthetic identities and fake documents, it is also being employed by firms to detect subtle fraud patterns that would otherwise go unnoticed.
Plaid’s recent momentum reflects the growing demand for advanced digital identity solutions. The company reported that usage of its IDV product surged more than 400% in 2024, highlighting the pressure on firms to protect their onboarding and transaction processes. In April, Plaid also announced a $575m funding round to further expand its product offerings, including enhancements across fraud prevention and payments infrastructure.
“Plaid has evolved from a business solely focused on bank linking, into a suite of data analytics products that are essential to financial services and adjacent markets,” Plaid co-founder and CEO Zach Perrett wrote. “Whether it’s signing up new users, fighting fraud, enabling bank payments, or making underwriting decisions, our network is core to the way that our customers run their businesses and consumers run their financial lives.”
TD Bank Group, known for its comprehensive range of banking, investment, and wealth management services, and Plaid, a leader in developing technology platforms for connecting digital financial applications, previously announced a significant partnership. This collaboration marks a vital step in advancing financial data sharing technologies.
The partnership’s objective was to enhance data security and privacy for TD’s customers in North America. This innovative data-access agreement will empower TD customers to securely share their financial data across Plaid’s extensive network of over 8,000 applications and services, without the need to disclose their login credentials.
Keep up with all the latest RegTech news here
Copyright © 2025 RegTech Analyst
Copyright © 2018 RegTech Analyst
