Voice of the Industry

Electronic identification made easy thanks to self-sovereign identity

Friday 25 November 2022 09:09 CET | Editor: Irina Ionescu | Voice of the industry

Raffael Grob, Senior Product Manager at Netcetera, talks about the new era of electronic identification with the help of self-sovereign identity, an ecosystem that provides complete transparency for consumers about the use of their digital IDs.

Identifying yourself online and proving that you are who you pretend to be is extremely difficult in our time and day. For many online transactions, it would be much easier if consumers could identify themselves as simply and securely as possible – for example to banks or authorities, when shopping online, or when proving their age in a situation where an age restriction applies. With the existing centralised identity systems, privacy suffers. 

There is also an uncomfortable dependence on big-tech companies like Google, Apple, etc.  regarding security and ease of authentication, and it seems like a more sustainable solution is called for.

To increase users' trust in digital identities, the self-sovereign identity (SSI) concept was developed. SSI is an ecosystem which offers complete transparency for consumers about the use of their digital identity, where they can determine for themselves which identifying features are shared with which organisations and services. 

Self-sovereign identity aims to enable citizens to securely store and manage their identity data in a special ID wallet,  i.e., on their smartphones. Users can then individually display their ID when signing a contract or using a service. The system is based on a three-party model: users send their data to a trustworthy ID service provider (issuer) who issues them with a corresponding certificate. When users identify themselves for a bank, authority, or service provider using this certificate, the issuer can then confirm the authenticity of the certificate on request.

Self-sovereign identity: Opportunities

From individual digital identity providers and consortia to major players like Microsoft, there is broad industry support for SSI, which presents a good opportunity for use. ID wallets and payment wallets both have extremely high security requirements, which, in turn, provides a further opportunity for development, as it is plausible for these two types of wallets to converge.

Unique opportunities are becoming available for banks and financial service providers since they have a large number of customer relationships and enjoy the trust of their customers. This can prove an excellent starting point for them to position themselves as digital identity and SSI providers.

Lastly, public institutions see self-sovereign identity as a promising way to meet existing regulatory requirements – whether for KYC (Know Your Customer) or for authentication to PSD2 regulations. At the same time, SSI also guarantees data protection.

Self-sovereign identity: Challenges

The challenges lie in the fact that the approaches to SSI, so far, have each pursued a local focus and there are few interoperable pilot projects. 

The only such project known is the initiative at EU level to standardise digital identity, which takes SSI and EIDAS principles into account. In addition, public administration needs to be involved, in order to maximise benefits such as cost savings for the private sector and, thus, fasten onboarding. However, this means that projects slowly progress. In a scenario without the involvement of the public administration, the private sector must provide an alternative to an ID card itself.

Digital identity solution

As an example, Netcetera has implemented an SSI-based proof of concept to create the basis for further product development. 

A variety of verifiable identification documents can be stored in the app, including an ID card, a driver's license, or a health insurance card. Users can then use the app to prove their identity for various online transactions. The integration of biometrics, such as fingerprint and face ID, is also among the app features.

Looking ahead to the future

SSI presents a fascinating opportunity for digitalising identity in a way that makes it convenient for users to do more online, from making important purchases, renewing government documents, or accessing classified information while keeping personal data more secure than ever. Raffael Grob, Senior Product Manager at Netcetera is confident that the obstacles that still exist regarding SSI will be overcome soon. Both consumers and companies will then be able to enjoy its many advantages.

About Raffael Grob

Raffael Grob is Senior Product Manager at Netcetera and leads the team developing the Netcetera Identity product. Raffael Grob has two decades of experience in the identity sector, which he has applied in providing identity solutions for numerous industries and companies. He studied business information science at the HWZ Hochschule für Wirtschaft Zürich. Above all, he is passionate about and committed to identity products that leverage current and future market trends such as self-sovereign identity solutions.

About Netcetera

Netcetera is a global software company with cutting-edge IT products and individual digital solutions. More than 2,000 banks and issuers, and 150,000 merchants rely on their digital payment solutions and globally certified 3-D Secure products. Founded in 1996, Netcetera has 800 employees across Europe, Asia, and the Middle East.

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Keywords: KYC, eKYC, digital signature, digital identity, PSD2, regulation, data protection, data privacy, data, biometrics, biometric authentication
Categories: Fraud & Financial Crime
Companies: Netcetera
Countries: World
This article is part of category

Fraud & Financial Crime


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