Digital identity remains one of the biggest challenges facing us as a global community. In 2018, leaders at the World Economic Forum said there was an “urgent need” to solve the digital identity problem. But four years later, we’re not very much further forward. Though there are more solutions on the market, being powered by more sophisticated technology and implemented by more engaged governments, there’s still one major flaw. It’s fragmented. And while digital identity remains fragmented, it remains unfixed.
Different countries have different digital identity standards
Over the last few years, governments around the world have launched over 165 digital identity schemes, and more new legislation and frameworks are in the pipeline.
Most recently, the EU put forward proposals for a European Digital Identity. The European Digital Identity would tackle the problem of fragmentation by creating a digital ID wallet that could be used across the EU by more than 80% of the EU population by 2030. Under the proposed framework, citizens and businesses would be offered digital wallets that link their national digital identities with proof of other personal attributes, like their driving licence or bank account. It would enable them to access basic services – like renting a flat or opening a bank account – in a uniform way, and without having to put their personal data at risk.
In the UK, the Digital identity and attributes trust framework operates a similar model. It enables people to re-use their verified identities with organisations inside the trust network, rather than having to be verified anew by each service provider. Similar ‘trust framework’ models have been established in Canada, Australia, Sweden and New Zealand.
Interoperability is critical for digital identity
For those of us in developed nations, with easy access to official documentation and smartphones, it might not seem like much of an issue. But over a billion people worldwide lack formal identification, and that stops them from accessing a range of basic services – from financial inclusion to healthcare.
Access to digital identity has been on the agenda of lawmakers for years, and several nations have made significant progress in extending it to more people. But it’s not just people without formal identification that struggle under our current systems. Take refugees. Over 20 million have fled from Ukraine in the last 6 months alone, and that’s just a fraction of global refugee movement. They need to be able to prove they are who they say they are in order to claim refugee status, but have historically struggled to do so, thanks to competing international systems that don’t recognise the authority of their documentation.
Herein lies the problem. It’s not necessarily – or at least, not only – the lack of digital identity systems that’s preventing us from making meaningful progress. It’s the lack of a unifying global standard to join them all together. Digital identity systems that work in one country don’t match up with those in others, where documentation differs and trust in its authority is low. Despite advancements in identity verification technology, it’s not getting any easier for people to reliably and consistently prove who they are. In an increasingly borderless world, digital identity needs to be interoperable to be truly useful.
Fragmented digital identity is frictional and inefficient
But these systems operate independently of each other. While the EU’s proposal makes steps towards greater unification and interoperability, it’s still in its early stages, and still limited to EU countries.
That creates friction and inefficiency for everyone. It’s something we’ve experienced for ourselves at OCR labs. As a provider of digital identity verification, we’ve had to be certified by several different governing bodies. In Australia, we’ve attained the highest level of remote accreditation for the Trusted Digital Identity Framework (TDIF). In the UK, we’ve completed Alpha testing for compliance with the Digital identity and attributes trust framework. In the US, we’ve completed testing for the National Institute of Standards and Technology (NIST) standard. These were all different and separate processes.
Businesses that need to verify users, and users that need to be verified, feel these frustrations, too. For businesses, it means having to create different onboarding and risk assessment workflows for each international market. This is cost- and labour-intensive, pulls focus from product innovation and stops them scaling. And it puts them at risk: where workflows are siloed and inconsistent, there’s more chance of personal data getting lost, and fraudsters slipping through the cracks.
For users it means repeatedly having to go through slow, frictional processes to re-verify themselves. They have to share (and therefore put at risk) multiple pieces of personally identifiable information (PII), with no guarantee that they’ll be accepted – especially outside their home nation.
Towards a global standard for digital identity
With the rise of migration, remote work and global e-commerce, the world is becoming ever-more borderless – but our digital identity systems still aren’t.
That needs to change. It’s not just new technology we need to improve digital identity, but a robust, inclusive and sustainable global standard for it. Waiting on individual governments to create solutions won’t solve the fragmentation problem, and in fact might worsen it – in some cases, several competing digital identity systems exist within the same country. Instead, it’s up to the private sector to envision, design and execute on a standard that works for everyone.
At OCR labs, we believe that only complete, fully-automated identity verification systems, built around speed and simplicity for the customer, can deliver a safe and sustainable way to onboard customers digitally, wherever they are – and protect individuals, businesses and society from the risks of digital identity fraud.
To find out more about what we’re building please reach out to us at email@example.com or request a demo.
We’re more than happy to chat about the state of the industry and if it's a good fit, show you how our technology could overcome the challenges you are facing. All tests welcome :)