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Adoption and usage of online and mobile services for banking (including e-wallets), payments, credit (including Buy Now Pay Later) and ecommerce continues to grow exponentially as consumers across demographics and regions get used to the mass-push to online usage that we have witnessed over the past several years.
Aligned to this is the fact that mobile phones have now become an unavoidable extension of our identities. We are using the mobile number increasingly as our unique identifier (services increasingly request mobile number over email address) and, as described in a recent GBG report ‘The State of Digital Identity 2022’, now “more than ever they (mobile phones) provide a key part of the puzzle when building trust in a digital world and enabling consumers to transact online with confidence.”
But rapid adoption and usage of these services brings its own problems as our understanding of the security loopholes within online services lags behind the release and enablement of solutions to streamline UX and prevent fraud.
Enabled by the widespread use of mobile devices, digital identity elements created by mobile phones can now offer a layer of additional data that can be provided to digitally-enabled organisations as a way to deliver some of these solutions, increasing confidence in identity verification and anti-fraud methods through the overlaying of a mobile-based ‘ownership’ flag onto other data sources.
By confirming the ownership of a given mobile number we can provide “a robust way of validating and authenticating an identity and preventing sophisticated fraud across channels such as online, call centre and in-branch”. Not only that, but as technology drives the reach, adoption and capability of mobile, the power of this as a data source, and the insights it generates, will increase.
Much has been done in this area, but we remain at the very start of this journey.
Mobile data has been around for a while, but as the sources of data become more reliable (mobile operators globally are now launching or maturing their Identity service offerings, replacing piece-by-piece the original SS7-based third party services with more accurate, secure and future-proofed products) we find ourselves at the beginning of what will be a rapid evolution of mobile digital identity services built to enhance the security and simplicity of IDV and authentication journeys, and to address and prevent new strains of digital fraud as they arrive.
And there are many new challenges to overcome. The overriding need to eradicate the weak underbelly of online transactions – the password – is being addressed across the digital communications industry and the innovators within the mobile identity industry are playing their part.
At Apple’s Worldwide Developer Conference, the company announced it will launch passwordless logins across Macs, iPhones, iPads, and Apple TVs around September of this year.
Solving the ultimate challenge – to link physical, real-world identity with an in-transaction digital identity – has not yet been solved. The steady migration to blockchain and crypto-based digital and financial services is creating a dependency on the concept of a ‘secure’ digital wallet for storage of your private access keys, but guess what, often these are protected by a password, which is merely shifting the point of failure rather than addressing the core issue.
We have a lot to do. It’s clear that, for all the progress that the Digital Identity industry has made over the last few years, and despite the opportunities that mobile is bringing to this arena, we are still some way from achieving a fully understood and enabled solution to the digital-first problems of today.
The findings of the GBG report should be a stark warning to businesses that they must take steps now to build trust in their digital services. This means demonstrating they can accurately identify an individual, thereby stopping fraudsters in their tracks, and customers will increasingly demand to know that their information is being kept safe.
The importance of Mobile Digital Identity in 2022 is that mobile technologies and data are increasingly becoming the focal point of the Digital Identity solution set. Innovation in the provision of mobile-based solutions will underpin the services of the next 5-10 years in this area, and the future starts now!
You can read and download the GBG report here.