Nick Mothershaw of the Open Identity Exchange discusses why digital identification methods are coming faster than anyone could expect – and why businesses need to react now or risk being left behind…
The world has reached a perfect nexus of conditions for a digital ID reality. The speed at which things are now moving is intense. It is only a matter of time before we see full digital ID adoption across the globe. And yet, there is still significant uncertainty, and therefore hesitancy, among many organisations that will come to rely heavily on digital IDs to start preparing for it.
One could argue that clarity is being provided by the many conferences taking place around the globe that explore, address and solve digital ID problems. But the issue is that they are not aimed at parties that have to think about the end consumers, manage their ID and what they can access. They are not answering key questions like: how will it work? Will digital ID be accepted from a legal and regulatory perspective? Will fraud levels increase? Will my organisation be held liable for losses? Will the benefits outweigh the cost of adoption? What should a good digital ID look like?
There are several forces now at play pushing digital ID into reality. It is important that organisations that now need to start thinking about the adoption of digital ID understand what they are and that emerging from them are answers to some of their questions.
1. The Pandemic Induced Acceleration of Digitalisation
The speed at which organisations across the globe progressed their digital transformation programmes en masse has never been seen before – yet Covid-19 made it a reality and a necessity. Many did not make it, while others are still catching up. Being able to confidently and securely identify customers in digital transactions and interactions is now a vital requirement.
2. The Availability of Credentials in Digital Form
Vital forms of credentials, including passports and driving licences, are becoming more readily available in digital form. The NHS vaccination certification can now be presented electronically in the NHS app, while Open Banking has introduced banking information into this ecosystem enabling people to prove who they are as well as what their financial status is.
3. The Acceptance of Biometrics
Biometrics are already standard in many aspects of people’s lives, such as unlocking phones. They enable additional proofing and are more robust authenticators than passwords, making digital ID more effective in mitigating fraud. They are increasingly being used in commercial situations. For example, at airports, travellers are being authenticated against their identity documents using biometric technology in automated border control (ABC) systems.
4. Legislative & Regulatory Frameworks Are Already Moving Towards Digital ID
Some high trust areas have already accepted the benefits and security provided by digital ID and are using it to enable confidence that a customer is who they say they are. The use of Digtial ID is already approved in anti-money laundering and terrorism legislation, and the HM Land Registry recently adopted it in property conveyancing transactions.
It is only a matter of time before we see full digital ID adoption across the globe. And yet, there is still significant uncertainty, and therefore hesitancy, among many organisations that will come to rely heavily on digital IDs to start preparing for it.
Chief Identity Strategist,
Open Identity Exchange (OIX)
5. Governments Are Creating Trust Frameworks
Trust Frameworks will play a crucial role in enabling trust amongst all the parties involved in the digital ID ecosystem. These frameworks will provide a comprehensive set of rules for digital ID, including proofing, verification, security, technical standards, certification, liability and compensation.
In the UK specifically, OIX provided extensive feedback on what good trust frameworks should look like, the majority of which was adopted by the government in its latest version of its digital identity trust framework. The UK Trust Framework is now close to being complete.
By providing clarity on the standards digital ID services will need to comply with, Trust Frameworks are enabling relying parties to trust them and they will help to alleviate many concerns around the adoption of digital ID.
6. Sector-Specific Projects Are Pushing for Adoption
With tens of thousands of organisations who have not even started to prepare for the digital ID revolution and at risk of getting left behind by it, sector-based digital ID ‘schemes’ have turned their focus on the topic. Well-established schemes operating in finance, house buying and selling, payments, pensions, employment vetting, age, travel and education have been actively pushing for adoption.
7. The Might of a Multi-Billion Dollar Industry
Billions of dollars are being poured into this space by technology giants, who see the value of digital ID and want to make the move to fully trusted digital transactions happen now. As a result, innovation is moving at a rapid pace and the technologies needed are now affordable.
Digital ID Is the Future
The benefits of digital ID for those who will be the heaviest users are significant. They will see greater user success rates at the point of onboarding. It will enable more positive engagement both first time and when they return. And a more positive user experience will mean reduced risk of loss. Fraud rates will go down thanks to strong ID proofing and robust biometric authenticators. Compliance will be more achievable, and it will enable a smooth shift to digital. In addition, the overall cost of ID per user will come down.
But there are still tens of thousands of organisations uncertain about the role it will play. There’s a clear need for specific initiatives that will give this audience the information and clarity it needs. Delaying preparations for the inevitable will result in many of these organisations getting left behind. Now is the time to start preparing for the adoption of digital ID.
ABOUT OUR GUEST WRITER
Chief Identity Strategist, Open Identity Exchange (OIX)
Nick Mothershaw is Chief Identity Strategist at the Open Identity Exchange (OIX), a non-profit trade organisation on a mission to create a world where everyone can prove their identity and eligibility anywhere through a universally trusted ID. Working with organisations 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.