Industry

How to incorporate age verification into your business

Any business that sells age-restricted products, provides access to age-gated activities, or delivers services that require adult consent must verify ages. Learn more.

Age fabrication is a widespread issue: as noted by the Journal of Studies on Alcohol and Drugs, underage customers in the United States consumed 11.73% of all alcoholic drinks sold in the U.S. market in 2016. And according to a recent JAMA research letter, 49.8% of tobacco and vape shops in California failed to check the ID of underage decoys in 2018.

The problem: if you sell age-restricted goods or services to minors, your business could face both fines and legal ramifications that could negatively impact ongoing operations.

And simply incorporating any old age verification system isn’t enough — you also need to ensure your process is simple and seamless to help reduce friction. This ties into the oft-referenced “three-second rule” of online interaction: if users are forced to wait more than three seconds for any function or response, they’re far more likely to abandon your site and find another business that offers a better user experience.

But what does age verification look like in practice? In this piece, we’ll examine some of the current compliance standards of age verification policies, how they’re applied at state and federal levels, which businesses are required to implement these controls, the potential impact to your business if these processes aren’t in place, and how to implement a comprehensive and user-friendly process.

Meeting age verification compliance standards

Both federal- and state-level compliance regulations exist to help ensure consistency in age verification expectations and processes. In many cases, federal rules establish a broad framework for compliance around certain goods — such as tobacco — while state rules provide more specific guidance.

State and federal regulations

Let’s break down a few examples of state and federal interaction around age verification compliance.

Consider the example of tobacco mentioned above. Under the Tobacco 21 legislation signed into law on December 20th, 2019, “it is now illegal to sell any tobacco product — including cigarettes, cigars, and e-cigarettes — to anyone under 21.” The law applies to all persons and retailers without exceptions. According to the FDA, sellers must now check the photo ID of anyone under 27 who attempts to purchase a tobacco product. Businesses are also only permitted to sell tobacco products in vending machines located within adults-only facilities and cannot give away free samples of any tobacco product.

Age minimums for alcohol sales have also been established. As noted by the CDC, under the National Minimum Drinking Age Act of 1984, the required age for the sale of alcohol was raised to match the minimum legal drinking age (MLDA) of 21 years.

Along with federal laws, many states have enacted their own age-related sales restrictions. In New York, for example, businesses are not only responsible for sales made directly to underage individuals but are also responsible for “indirect deliveries,” which occur when another person purchases alcohol and then passes it on to a minor. If businesses do not comply with these regulations, the New York Liquor Authority can issue temporary or permanent bans on liquor licenses or assess fines of up to $10,000 per violation.  

In California, Bill 2511 now requires that all online businesses selling age-restricted products or services such as fireworks, firearms, tobacco, or ammunition must “take reasonable steps, as specified, to ensure that the purchaser is of legal age at the time of purchase or delivery, including, but not limited to, verifying the age of the purchaser.” Businesses that fail to comply with this legislation may be subject to a $7,500 fine per violation.

Types of businesses liable for age verification

Any business that sells age-restricted products, provides access to age-gated activities, or delivers services that require adult consent must verify ages. Some of the business types include:

Tobacco and alcohol sales

As mentioned earlier, both tobacco and alcohol sellers must make an effort to verify the age of online purchasers. In the case of tobacco, this verification includes everything from cigarettes to smokeless tobacco, cigars, hookah pipes, e-cigarettes, nicotine gels, and dissolvables. Tobacco can only be sold to those over 21. Cannabis laws are slightly different: Many states permit the use of medical marijuana for those over 18, but businesses can only sell cannabis to people over 21. As noted above, the minimum age for alcohol sales is 21 across the United States.

Gambling operations

The United States legalized online gambling sites in 2011, and the market was worth nearly $2 billion in 2020. Along with success, however, comes more stringent restrictions that require online gaming sites to verify the age of potential players. The legal gambling age varies by state. Some, like Montana and Oklahoma, have set the minimum age at 18, while the majority of states have opted for 21.

Gaming sites

As noted by Business Insider, the pandemic created an opportunity for a new type of online wagering: video games. Platforms emerged that allowed players to bet real money on the outcomes of their favorite video games, but many of these new platforms did little to keep out underage bettors, despite requirements to do so. (Gaming sites generally follow the same rules as casino gambling, with legal ages set at either 18 or 21 by state.) As this market evolves, businesses should expect stronger restrictions and steeper penalties if they fail to follow these rules.

Medical services

Companies that offer medical services are also required to verify ages — a task that has become even more critical thanks to the rise of telemedicine. According to Forbes, most medical practices currently lack the ability to verify identity online. But with telemedicine here to stay, both age and identity verification expectations will rapidly evolve. Generally speaking, patients must be at least 18 to give informed consent for medical procedures or services.

eCommerce businesses

Any online business that sells age-restricted products or services must implement an age verification system. These products may include alcohol, tobacco, firearms, ammunition, or adult content. Failure to do so could result in fines, legal challenges, and a damaged reputation. Depending on the product being purchased, the legal age may range from 18 to 21.

Food delivery services

Food delivery services are also required to verify ages if consumers purchase alcohol. Regardless of whether alcohol is part of a larger food purchase or ordered on its own, delivery drivers must see proof of legal age before releasing any alcohol to customers. Anyone ordering alcohol must be 21 or older.

Cutting out complexity: why you need an online age verification solution

The simplest form of online age verification is the familiar “are you ___ years old?” pop-up seen on many websites. The problem? While this approach is streamlined, it relies entirely on trust; users can simply lie if they’re underage. Because of this, simply asking users if they’re a certain age doesn’t usually satisfy due diligence, which requires companies to implement steps that actually reduce overall risk.

The other side of the age confirmation coin is complexity. If your age verification process is cumbersome and slow, users will simply take their business somewhere else.

If you need an age verification system, your best bet is to find one that bridges the gap between speed and security to help reduce risk and ensure regulatory due diligence. With Persona, users can verify their identity in seconds, and you can specify everything from which forms of verification you’ll require to how many attempts users can attempt verification in a row.

The Persona age verification process is simple: First, users take a picture of their ID. Then, Persona verifies the authenticity of the ID, extracts the birth date, and approves or denies the request based on the calculated age. If there’s concern that individuals may be using someone else’s ID (such as a child using their parent’s ID), you can also request a selfie for extra verification.

Persona also helps reduce user drop-off by guiding users through the verification process, leveraging auto-capture to minimize data entry errors, empowering easy device switching, and supporting more than 200 countries and territories and 20 languages. With our trusted identity infrastructure, age verifications typically take around 5 seconds — much faster than traditional identity verification providers who use manual review processes, which can take hours or days to return results.

The bottom line: age verification is essential for online businesses and retailers. But complexity can cause customer frustration, while oversimplification can introduce security risk. Persona’s market-leading age verification solution empowers easy age verification that’s compliant, accurate, and comprehensive.

Need robust, reliable, and streamlined age verification? Contact us to learn more or get started for free.

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