Banks are in an ideal position to evolve into trusted providers of digital identity, a digital ID expert has claimed.
Jukka Yliuntinen, Co-Chair of Mobey Forum’s Digital ID Expert Group and Vice President at Giesecke+Devrient Mobile Security, said the benefits of the right kind of ID are huge.
“The rapid pace of digital transformation has left many industries scrambling to find secure, convenient ways of establishing identity for digital services,” he said. “The identity ecosystem has become fragmented and complex, with too many stop-gap solutions creating and propagating vulnerabilities and friction. Yet the incentives to get digital identity right are staggering.”
In the UK, he claimed, an effective digital identity solution could contribute 2.5% to GDP: “Consequently, there are many players looking to capitalise on the digital identity opportunity, spanning government, technology giants, social media platforms, and specialist start-ups,” he added. “It is banks, however, that are in the ideal position to evolve into trusted providers of digital identity.”
Consumers, he said, trust banks to secure their data and privacy, citing a 2018 survey which found that in Germany, over 60% of consumers would prefer banks to provide their digital identity, compared to the 5% who would prefer a social media platform.
Regulation, he said, plays an important role in cementing this trust: “Banking is a highly-regulated industry with rigorous compliance procedures,” he concluded. “This promotes consumer confidence. It also means banks are well-equipped to address complex regulatory requirements. In comparison, the big tech giants have always operated with relative freedom. But this is changing. The €50 million fine recently imposed on Google by French authorities for breaching GDPR shows that, even with vast legal and compliance resources available, it still takes time to adapt to tighter constraints.”

by Guy Matthews