Voice of the Industry

Digital IDs are putting social equality at people's fingertips

Monday 15 November 2021 09:03 CET | Editor: Alin Popa | Voice of the industry

Sebastián Stranieri, Founder and CEO VU, shares with The Paypers the opportunities digital identity can unlock for the banking, cybersecurity, and healthcare sectors

You're at the airport, waiting in line to pass through TSA. Rather than fumble through your bag trying to find your passport and then be grilled by an agent, you pull out your phone and approve a request to access the digital version of your ID, confirming your identity via face or touch. You pass through security in seconds.

That tech is already a reality in Florida, where the state is working with Apple to develop digital ID support for the iPhone wallet. The project comes after the US government has invested hundreds of millions of dollars in digital IDs - the ability for people to prove who they are online - to not only boost inclusion, but actively combat inequality. 

Currently, one billion people around the world are unable to prove their identity, but as the processes that make up daily life become digitised (voting, paying bills, working remotely), there is greater scope to give people access to basic necessities through online authorisation. 

The problem, however, is that skepticism is rife around governments' control of citizen data. If digital IDs are to really close gaps in social inequality, private industries are better positioned to do so. These spaces are ahead when it comes to innovation, and people tend to place greater trust in private industries than governments. Banking, cybersecurity, and healthcare are underway in the journey to unlock equal opportunities for more people. Here's how:

Banking 

More than 1.7 billion individuals in the world are unbanked - meaning nearly a fourth of the entire world population doesn't have a formal bank account and are cut off from receiving loans, interest rates, credit scores, mortgages, and other essential services. Perhaps for this reason, some of the nations with the highest unbanked populations are also the biggest adopters of innovative fintechs that provide alternative routes to essential services.

These fintechs have adopted digital IDs much faster than their public bank counterparts. Many fintechs use the IDs to grant users access to solutions, protect their data, and make secure transactions. Underbanked populations can more easily get a fintech digital ID than a traditional bank account because they can set one up online, rather than through an in-person appointment, which people who live in rural areas, have limited mobility or don't speak the local language are less likely to do.

With these IDs, more people can take advantage of fintech offerings like micro loans, trading, and insurance that contribute to wealth building. They can also shop around and find financial services more readily because digital IDs can consolidate multiple accounts into a single interface and authorisation process. That gives people an overview of their finances and helps them to make smarter decisions about their money. 

Traditional banks are already integrating digital IDs as they collaborate with fintechs. The UK bank TSB has partnered with fintech ApTap to provide a dashboard for users' bills and subscriptions, helping them compare and switch to more cost-effective deals. Likewise, in Argentina, MODO is the first digital wallet to integrate people's bank ID into a single app. MODO connects to the user’s existing accounts, giving them access to all their different banks in the same place.

Cybersecurity

Last year, over 300 million people were impacted by data breaches. Especially worrying is the targeting of vital services. Cyber-attacks have closed hospitals, forced electrical grids offline, brought cities to a halt, and even compromised democratic processes. And on an individual level, they can cost people their savings and privacy. 

Digital solutions have a responsibility to keep the users that trust them safe. All-encompassing digital identities close the number of entry points available to cybercriminals. For instance, rather than use two-factor authentication across devices, an insurance company could authorise a user by asking them for their digital ID through a decentralised, third-party platform, which then pings the user to approve access to the information. These digital IDs can be stored on a lightning network, on smart contracts or with multiparty computing.

The tech is particularly beneficial in emerging economies, which are increasingly drawing the attention of cybercriminals due to their growing, and therefore more lucrative tech landscapes. And because these economies' cybersecurity isn't as developed as those in mature markets, they are in a position to build using digital IDs from the ground up. As a result, emerging economies can deploy digital IDs on a broader scale and empower some of their most vulnerable populations.

Healthcare

Prior to the pandemic, half the world lacked access to healthcare, and even during the global crisis people have faced heightened barriers to care based on their location, race, sex, physical abilities, and economic status.

Although the Internet of Things and the medtech boom has made healthcare more accessible than ever before, healthcare data and services are a complex web that lack clear structure. Every healthcare organisation assigns its own separate identifier to the same patient’s data whether that’s electronic health records (EHRs), clinic registries or claims databases. The potential to inaccurately identify a patient is therefore huge, and costs hospitals USD 1.5 million on average per year.

The World Bank states that a secure, inclusive, and responsible method of identifying and authenticating patients improves healthcare systems. If patients’ information were unified in a single digital identity, professionals would be able to easily access a multitude of data in a single place - including data from wearables, prescriptions, allergies, and their medical history. It would also ensure that professionals anywhere in the country always have the same, correct patient data.

Patients would be able to quickly verify their identity via a smart device and receive treatment faster, as opposed to waiting for healthcare organisations to communicate with one another. Plus, these identities boost inclusion, as people who have cognitive disorders or memory loss don't have to remember multiple usernames and passwords.

The UN and World Bank have long been encouraging states to give citizens proof of legal existence to bolster their human rights, but in the digital age, that responsibility can be championed by the private sectors. 

As banking, cybersecurity, and healthcare incorporate digital IDs to give more people a fairer, higher quality of life, fellow industries will follow suit, and will work toward automatically ingraining equality in the technology of today and tomorrow.

About Sebastián Stranieri

Sebastian Stranieri has over two decades' experience in the cybersecurity industry, and his career has always been driven by the desire to innovate more secure solutions for internet users. In 2007, Sebastian founded VU, which has since risen to become a leading multinational fraud and identity protection company with over 350 million users worldwide. Based in Argentina, VU offers modular cybersecurity solutions that live in citizens' and businesses’ existing systems, using a novel combination of AI and machine learning. The award-winning company coined the concept of an ‘online persona’ to provide an all-in-one, seamless user authentication process. His vision for VU was immediately adopted by the major Latin American bank Banco Credicoop, and has since grown to serve over 100 corporate and government clients.

About VU

VU provides robust identity verification for its users which allows a more holistic authentication paradigm. Through the combination of traditional cybersecurity controls with geolocation, biometrics, and user behaviour analysis based on machine learning, VU enables a continuous authentication process where the user is seen as a whole, rather than a set of credentials. Currently, the company provides secure and frictionless digital experiences to more than 350 million people over the world.

Free Headlines in your E-mail

Every day we send out a free e-mail with the most important headlines of the last 24 hours.

Subscribe now

Keywords: identity verification, digital identity, biometrics, cybersecurity, digitalisation, fintech
Categories: Securing Transactions | Digital Identity, Security & Online Fraud
Countries: World
This article is part of category

Securing Transactions