By Nick Mothershaw, Chief Identity Strategist at the Open Identity Exchange (OIX)
Digital-first initiatives have had their place on board agendas for a number of years, but the global pandemic sent them into overdrive. There have been winners and losers. We’ve seen the demise of organizations that weren’t ready for such a rapid change and there are many who are still catching up.
We’re now reaching another turning point in the journey towards a digital-first world. Digital ID has come of age. Governments, technology giants and many other major stakeholders across sectors and across borders are working towards making it a reality over the next two years. But we are still seeing hesitancy amongst far too many organizations — tens of thousands in fact. Digital ID is on their radar, but they haven’t started preparing for full adoption. And they’re the organizations that will come to be the biggest users of digital ID.
The barriers to adoption
There’s a vast amount of digital ID noise taking place, with numerous conferences, whitepapers and debates across the globe focusing on the topic. But the questions of those organizations that have yet to start preparing are specific to how digital ID will work for them and how it will fit in. These questions aren’t being addressed sufficiently enough.
The impact on fraud levels is proving to be a considerable area of concern. And with this comes a lack of clarity on where liability will sit if fraud occurs. There is also a need for greater clarity around how to establish digital ID securely and retrieve the right information without breaching regulatory or legislative rules. The question of business cost follows closely. Will the processes and tools needed to adopt, as well as address fraud and regulatory concerns, significantly increase the cost per user?
These are major questions that need answering before relying parties will make a move towards full digital adoption. The reality is that full digital ID adoption is happening, whether organizations are preparing for it or not. Their questions are being addressed, but this needs to be communicated more effectively to them.
Key developments driving full digital ID adoption
Global technology giants have played an influential role, having invested billions into the creation of technologies to enable digital ID and bring the costs of adoption down. However, there are two key developments that have been pivotal in propelling digital ID forward in the last two years — biometric technologies and the increased availability of digitally presentable credentials.
Only within the last decade have biometric technologies become mainstream. As an identity verification and authentication tool, biometric security technology is more difficult, if not nearly impossible, for fraudsters to attack. It is already in use at airports when authenticating travellers against their identity documents in automated border control (ABC) systems. And more biometric innovations are continuing to emerge.
With everything moving online during the pandemic, intense focus fell on developing digital equivalents of paper documents proving who we are in the physical world. Digital driver’s licence projects, for example, have gathered momentum in countries including the USA, UK, Australia, and the Netherlands, while there are now over one billion ePassports in circulation. Vaccination certificates can now be presented in an app when travelling. In the UK, Open Banking has made it easier for people to prove who they are as well as what their financial status is without having to produce physical documents.
Both biometric technologies and digital credentials, alongside continuing technological advancements, are allowing for stronger ID proofing and more robust authentication, making digital IDs far harder for fraudsters to attack.
Both developments have also helped drive acceptance and recognition from a legal and regulatory perspective. Digital ID already plays a key role in anti-money laundering and terrorism regulation. And it is quickly finding its place in other high trust areas. Take for example house sales in the UK. The HM Land Registry recently adopted digital ID, so that people could prove who they are in property conveyancing transactions. OIX contributed its feedback to the HM Land Registry’s identity proofing approach to ensure both inclusivity and a consistent level of trust was achieved.
Creating a framework of trust
Governments are working on Trust Frameworks and they’re gaining traction around the world — UK, Canada, Australia, Sweden and New Zealand. The OIX is helping shape what good trust frameworks should look like and ensuring that the standards digital ID services should comply with are clear. These frameworks will be essential in enabling all parties in the digital ID ecosystem to trust each other. They will provide clear guidelines for organizations who are hesitating, and answers to their questions around proofing, verification, security, technical standards, certification, liability and compensation.
A need for education
Experts and providers have been vocal about their work in the digital ID space, but this has not given enough clarity to those parties that have to think about the end consumers, manage their ID and what information they can access. To start the process of adoption, they need to understand what a ‘good’ digital ID looks like. There’s an urgent need for initiatives squarely aimed at this audience.
The good news is that running alongside the development of government Trust Frameworks are sector schemes, which are delving into the practical considerations and significant benefits for each sector. OIX is working closely with these schemes to educate and encourage adoption across banking, motor finance, retail finance, house buying and selling, payments, pensions, employment vetting, age, travel and education.
OIX is also holding a major conference on Thursday 14th October 2021 in London — The Identity Trust Conference – Making Digital ID a Reality — that will cut through the digital ID ‘noise’ and provide answers.
The bottom line is that digital ID is heading towards mass adoption. It’s time for organizations to start preparing for it.
About the author
Nick Mothershaw is Chief Identity Strategist at the Open Identity Exchange (OIX), a non-profit trade organization on a mission to create a world where everyone can prove their identity and eligibility anywhere through a universally trusted ID. Working with organizations across the globe, Nick is leading the development of clear guidance around inter-operable, trusted identities. In his previous role as Director of ID and Fraud at Experian, he led the development, launch and operation of a full ‘Identity as a Service’ solution – the first live example of a digital ID that is seamlessly interoperable across public and private sector in the UK.
DISCLAIMER: Biometric Update’s Industry Insights are submitted content. The views expressed in this post are that of the author, and don’t necessarily reflect the views of Biometric Update.
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