2019/07/18

Digital Identity – Who offers a solution for everyone?

Fintech | Reading time - 2 min

In analogue life we prove with our identity card or passport that we are who we claim to be. How much easier would life on the internet be if we had a digital identity that could prove beyond doubt who we are? Some countries, such as Estonia, Sweden or the Netherlands, already have systems in place that allow us to use uniform digital identifiers to deal with administrative formalities or banking transactions. In Germany, we have not yet reached that stage. Companies like Facebook or Google have the necessary reach to assert themselves as “identity guardians” across the board. But is that in our interest? Just think of the recent hacker attacks and the additional data streams flowing into the US.

Who is competing with the GAFAs in Germany?

Both mobile phone providers and banks are predestined, as their customers have to identify themselves at the beginning of the business relationship via PostIdent or VideoIdent, but have not yet exhausted this potential. The electronic identity card should protect us citizens from identity theft and misuse on the internet and save us from having to enter over and over again. With access barriers like a readeing device that hardly anyone owns and immature apps, this initiative has not been a success either.

The new shooting stars on the identity sky are pure ID providers, such as NetID, Verimi, Yes and Re:claim ID. While NetID and Verimi represent a “1:1 substitute” for login via Facebook or Google from the user’s point of view, Yes is an identity mediator. The aim here is to make the online banking login of users usable for other online services. According to the Fraunhofer Institute for Applied and Integrated Security (AISEC), Re:claim ID enables the user “to make individual identity attributes available to other parties in a secure and self-determined manner”.

And the banks? For banking and stock exchange transactions online, users of banks must be identified. So it would make sense for banks to act directly as ID providers. Loans could also be granted quickly and easily using a digital ID. In addition, “social scoring”, in which loans are granted through analysis of social network profiles, could be eliminated.

For us users, a digital identity is important in order to gain sovereignty over our personal data and to protect our identity in the digital world as well. In my opinion, in order for there to be a meaningful solution for everyone, the major providers should consider how they can establish suitable partnerships to become broadly relevant. Otherwise, we will have to let the big US corporations take the lead again, also in the area of digital identity.

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