ID.me Raises $340 Million at $2 Billion Valuation to Expand Digital Identity and Combat AI Fraud

Digital identity verification provider ID.me has raised $340 million in a Series E funding round, lifting its valuation to more than $2 billion. The financing was led by Ribbit Capital, with participation from Ares Credit funds, Moonshots Capital, and new investor Positive Sum. ID.me says the new capital will be used to strengthen protections against AI-powered fraud and expand its secure digital identity services.

Growth and public sector impact

Serving more than 152 million users, ID.me has played a prominent role in government service delivery. Seven states report that the company helped prevent over $270 billion in unemployment fraud during the pandemic. In Virginia, its deployment in 2024 resulted in a 173 percent increase in digital claims and a 57 percent reduction in call center volume, illustrating gains in accessibility and efficiency.

According to the Government Accountability Office (GAO), federal fraud losses averaged between $233 billion and $521 billion annually from 2018 to 2022, highlighting the scale of the problem that digital identity tools aim to address.

Strategic positioning

This latest funding follows ID.me’s $1.8 billion valuation in late 2024. The company stated that the investment will accelerate its mission to expand access to secure, reusable digital identity and to counter increasingly sophisticated fraud threats, including those leveraging artificial intelligence and deepfake technologies.

Industry-wide, digital identity providers are enhancing security capabilities to address the same challenges. The growing need for trusted verification reflects broader trends in fraud prevention, compliance, and digital service delivery.

Sources: Technews180, Government Accountability Office, MicroVentures

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By Ji-seo Kim