Digital identity: there is a lot at stake

We moved on halfway through 2024 digital transformation become digital first. From shopping to banking to healthcare and much more, the expectation is increasingly that you can at least start – or even end – your journey online. While the pandemic was the rocket fuel for digitalization, the pace of change is only expected to accelerate – driven by AI, biometrics and quantum computing.

A 2023 connectivity benchmark report found that 72% of customer interactions are digital, and we are witnessing the convergence of payments and identity in real time with the expectation that 30% of digital identities will be stored in mobile wallets by 2029, according to a Report from 2023 by Goode Intelligence. Digital First also applies to bad actors, with cybercrime now costing trillions (yes, trillions with a ‘t’) in global damage every year.

A valuable commodity with a patchwork approach

According to former Google CEO Eric Schmidt, “In the future, identity will be the most valuable asset to citizens, and it will exist primarily online.”

Digital identity is poised for rapid long-term growth, enabled by biometrics-based identity verification. From banking to travel, a trusted identity is essential to enabling secure, seamless digital travel. Digital account opening simplifies and secures a complex digital banking process to accelerate customer acquisition and increase financial inclusion. Seamless travel allows border control authorities to find and focus on the needles in the proverbial haystack, while vastly improving the traveler experience.

Yet the current state of digital identity is more of a patchwork of different identities across government and commercial systems, already leading to the proliferation of digital identities and wallets reminiscent of the early days of the password.

Today, the average Internet user has more than 100 accounts that require a password; by some estimates, as high as 240. Imagine the identity crisis if you try to manage more than 240 IDs! Beyond convenience concerns, this fragmented approach to digital identity is also ripe for abuse by bad actors looking to commit synthetic identity fraud, further fueled by generative AI.

Europe takes a regulatory approach

With global security, stability and prosperity at stake, there is a lot at stake in getting digital identity right. However, the world is not moving at the same pace – or even in the same direction.

Similar to the groundbreaking General Data Protection Regulation (GDPR) and the AI ​​Act, Europe is once again taking the global legislative lead with the EU Digital Identity Regulation (EUDI), which gives member states until 2026 to provide their citizens with an EUDI wallet built to common specifications. . Some Member States are already testing wallet solutions that comply with EUDI standards, while Estonia, an early adopter of digital identity with its e-ID system, will need to update its existing framework to adhere to EUDI .

The EU is sending a clear message that it intends to be a leader in the digital economy by accelerating the adoption of digital identities to increase growth and competitiveness while enabling all Europeans to participate and benefit from taking advantage.

Big tech a catalyst for digital identity innovation

Other jurisdictions, most notably the US, which typically eschew national identity programs, rely on big tech players to provide digital identity options for their citizens. Apple made clear its digital identity ambitions at WWDC 2021 when it announced support for storing credentials in the Apple Wallet application. Since then, four states have launched mobile driver licenses (mDLs) through Apple Wallet, while another 20 states are currently evaluating it. The TSA is also testing the use of digital identity data stored in some mobile wallets – including Apple, Google and Samsung – for identity verification of passengers at select airports. While big tech remains a catalyst for innovation and superior user experience, this direction also introduces additional concerns around citizen privacy and control over citizen credentials – especially across national borders.

Whether government-led or technology-led, digital identity adoption is expected to increase exponentially for the rest of the decade… and beyond. Getting digital identity right is about applying the best practices learned from different approaches in different jurisdictions.

At Entrust, we want to help our customers realize secure, trusted identities that span our digital and physical worlds. By leveraging advanced technologies such as phishing-resistant, passwordless multi-factor authentication (MFA) and AI-powered identity verification, organizations can significantly improve their security posture and operational efficiency.

The post Digital identity: the stakes are high appeared first on Entrust Blog.

*** This is a Security Bloggers Network syndicated blog from Entrust Blog, written by Jenn Markey. Read the original post at: https://entrustblog.wpengine.com/2024/06/digital-identity-theres-a-lot-at-stake/