Banks are at risk of losing their strong position in the development of national digital identity schemes to Big Tech giants and other globally networked firms, according to a report from industry association Mobey Forum.
The 'How to Make Digital Identity a Success' provides a comparative overview of seven digital ID schemes across Europe and North America - Alastria, e-Estonia, Itsme, NemID, BankID, Verimi and Verified.Me.
The report contends that Google, Amazon, Facebook, Apple, Alibaba/Alipay and other hugely powerful digital players have serious potential to upend the global market for digital ID
Jukka Yliuntinen, co-chair of the Digital ID Expert Group, Mobey Forum. “Banks have mastered the ability to operate at scale in highly regulated environments, under conditions that require rigorous and stringent security and identity verification procedures. This has enabled them to play a key role in the evolution of national digital ID schemes and also makes them prime candidates to be future guardians of digital identities, supporting services that stretch far beyond banking and generating new revenues as a result.
"This advantageous position could change quickly, however, as other powerful networked stakeholders move into the space. Banks must be aware that the window of opportunity to adopt these critical roles may be closing, perhaps faster than they think.”
To maintain their position, banks need to cement their role as arbiters of trust in collaborative models backed by other key service providers, including governments, regulators and telcos.
“This collaborative model is here to stay,” says Elina Mattila, executive director, Mobey Forum. “It’s only through close collaboration that banks can both address the challenges and seize the opportunities presented by digital identity.”