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Case Study

Telekom Deutschland drives corporate digitalization forward with Nect

A practical report from NECT & Telekom Deutschland.

Onboarding progress for the market leader

Telekom Deutschland GmbH, a subsidiary of Deutsche Telekom AG, serves around 53 million mobile customers. This includes contract and prepaid models. In addition, the company provides services to around 17 million landline and 4 million TV users. Revenue in 2022 exceeded 24 billion euros. As Germany’s leading telecommunications company, Telekom itself cites its excellently developed network as the basis for its success. Quality and user-friendliness are always at the center of Telekom’s services. Consequently, all Telekom services have been increasingly digitalized for years.

In this context, Tim Götzen, Vice President Compliance & Risk Management at Telekom Deutschland, pursued the goal of establishing a digital alternative for identifying Telekom customers several years ago. The first approach was the development of an in-house solution, which, however, did not achieve the desired success in implementation. Through a conversation with R+V Versicherung, which was already working with Nect at the time, Tim Götzen learned about Nect’s solutions.

“Nect offered us a more cost-effective identification option while simultaneously providing a significantly higher assurance level than the methods used previously.”

Tim Götzen

Vice President Compliance & Risk Management | Telekom Deutschland

“I wanted a fully digital customer journey for our online ordering processes, starting with onboarding and for both private and business customers,” says Tim Götzen.

Online ordering processes at Telekom Deutschland have already been implemented via the telekom.de website and telephone service. Integration of the service into the MeinMagenta app is planned for 2023. The customer journey also includes customer identification with the aim of fraud prevention and anti-terrorism.

The basis for this is Section 172 (2) sentence 3 of the Telecommunications Act (TKG), which mandates data collection for certain telecommunications services.

Increased identity theft with existing identification methods

Until that point, Telekom Deutschland worked with various, partly analog, identification methods. These included PostIdent, identification in Telekom shops, and a video identification system with call service agents built specifically by Telekom. All existing identification procedures at the time carried a higher risk of identity theft. In addition, with the start of the corona pandemic, the possibility of on-site identification in retail stores or at shipping service providers had to be discontinued. Furthermore, there were only very limited resources of video agents for video identification.

“The Nect technology convinced us with its excellent user experience and unrestricted availability, as well as the already proven, very high acceptance by customers.”

Tim Götzen

Vice President Compliance & Risk Management | Telekom Deutschland

Digital onboarding step by step

Telekom Deutschland was therefore looking for a digital identification solution that would meet high security requirements while offering a user-friendly process that functions without human control.

The fully automated Nect Ident procedure was initially integrated at Telekom within three months for the conclusion of long-term mobile phone contracts.

Long-term contracts, so-called postpaid contracts, involve a continuing obligation with a specific contract term and often a subsidized end device. The conclusion of such a contract therefore includes the collection of customers’ bank details. Although telecommunications companies are not legally required to identify customers when concluding long-term contracts, there is certainly a business interest in avoiding fraud, e.g., by providing a non-existent account.

With Nect Ident, users can identify themselves via smartphone regardless of location and time and without waiting. The process includes various identification methods. These include the automatic Video-Ident developed and patented by Nect, the online ID function (eID), the international ePassport with NFC chip, and the wallet function of the Nect Wallet app, which enables the reuse of an already digitalized ID document via biometric comparison. The core method, automatic Video-Ident, involves a recording of the ID document and a selfie video. Here, security features of the document are checked and the face from the video is compared with the one on the document. Furthermore, it is ensured that the person is a living human being and not, for example, a mask.

Partnership on the Nect Level

The successful start of the collaboration and the positive feedback from customers provided a reason to continue Telekom’s digitalization path together. To further improve the user experience and offer an even faster identification option, Telekom decided to activate Nect’s wallet function. This happened without additional effort on Telekom’s part. The wallet function allows customers who have already identified themselves once via the Nect Wallet app and have digitally stored their ID document to re-verify themselves for another service, for example a long-term contract, within seconds. This is done simply by taking a new recording of the face. The recording is compared with the stored ID document by AI-based technology to determine whether the person to be identified is actually the holder of the stored ID document.

Success in Numbers

approx. 0 million €

cost savings per year

100 %

successful identifications since 2020

Telekom carried out a further expansion of the identification offering in December 2021 in the course of a new decree on identification procedures in accordance with Section 172 (2) sentence 3 TKG (new version). This enabled the use of fully automated Video-Ident procedures for prepaid purchases as well. To prevent fraud and terrorism in previously anonymous purchases of prepaid cards, Nect Ident has since been used additionally for Telekom’s prepaid business. By then, more than 100,000 Telekom customers had already used Nect for their identification.

Simpler identification for business customers too

Via Telekom’s business customer portal, companies can manage their products and services themselves via personal access with a username and password.

Nect Business Ident was successfully implemented for this purpose in the summer of 2022. This is because even in business transactions, the person completing the transaction must be identified or sign manually to confirm their authorization. The check with Nect includes the usual identification via document recording and selfie video. In addition, a comparison with the commercial register entry takes place during the process, which is not visible to users.

“The Nect technology convinced us with its excellent user experience and unrestricted availability, as well as the already proven, very high acceptance by customers.”

Tim Götzen

Vice President Compliance Risk Management | Telekom Deutschland

More security and customer satisfaction at lower costs

By using Nect’s fully automated identification solution, Telekom has been able to successfully identify around 500,000 customers since the start of the collaboration in 2020. Approximately two million euros per year could be saved through increased cost efficiency and the containment of identity theft or the prevention of fraud. In customer surveys, Telekom also noted a significantly higher satisfaction rate.
Since the beginning of 2023, all four identification methods available via Nect Ident have been activated at Telekom. Telekom Deutschland also wants to drive its digitalization forward together with Nect in the future. For example, Nect technology will soon be available to Telekom’s Europe-wide companies for their onboarding processes via Telekom’s One App. Furthermore, Tim Götzen plans to optimize Telekom shops in the next step: “We especially want to further improve the identification of our customers in stationary retail. For this, I could well imagine working with Nect to develop a solution for private and smaller business customers.”

The most important KPIs at a glance

Objectives

  • Digitalization progress within customer processes
  • Increasing security in identification processes
  • Improving the customer experience
  • More efficient cost and time management

Approach

  • Use of certified, fully automated identification technology with flexible scaling options
  • Successive expansion of the collaboration into further business areas

Results

  • No successful fraud attempts when using Nect technology
  • Cost savings of around 2 million euros per year
  • Proven higher customer satisfaction
  • Multiple expansions of Nect's use to various business areas since the start of the collaboration
“The collaboration with Nect was extremely partnership-based from the very beginning and always at eye level. We see ourselves as a team that drives digitalization forward together at Telekom Deutschland. Therefore, we have expanded our collaboration with Nect piece by piece and would like to digitalize and automate further processes with Nect technology in the future. For us, efficiency, security, and above all user-friendliness are the priorities.”

Tim Götzen

Vice President Compliance Risk Management | Telekom Deutschland

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