Why can’t your bank store your identity? Securely, intelligently?

Written by on July 12, 2016 in Guest Blog with 1 Comment

Speaking at the Dutch National Blockchain Conference back in June, I remarked in passing that I thought bank customers would be storing their money (their wealth) in all sorts of places in the future – from a small percentage in demand deposit accounts, through investment accounts of one form or another, P2P marketplaces and who knows what – but that they would be storing their identity back at the bank.

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Click for a link to speakers’ videos

This was picked up on Twitter and a few people commented on it, so I thought I’d expand on what I meant here. First of all, it is neither a new idea nor my idea: other people have been saying this and they’ve been saying it for a while. I might have expressed it in a better soundbite, but it isn’t my concept.

Britain’s high street banks believe their future role will be as repositories of more than just money: they want to be the safe place where customers store their digital identities.

[From Banks want to keep your digital ID in their vaults – FT.com]

That’s from a couple of years ago. It is not some out-of-left-field edge thinking or me spouting aphorisms for a conference stream either. Round about this time, the European Banking Association (EBA) said something similar and you can’t get much more mainstream than them.

Banks are well positioned as is explained in a recent white paper of the European Banking Association (EBA).

[From Digital Identity: how banks can position themselves in their customer’s online lives | Innopay]

So what might banks do with your identity once they’ve got it safely locked away in their vaults? Well, one idea, particularly popular with me, is that they might give you a safe, pseudonymous virtual identity to go out an about with.

Some suggest that digital identity verification by banks could ultimately end the need to type in a credit-card number on an ecommerce website

[From Banks want to keep your digital ID in their vaults – FT.com]

Some others (uncharitable persons, of which I am not one) also suggest that banks will pratt about and muck this all up and hand digital identity ownership over to Apple, Facebook, Google, Amazon and Microsoft on a plate. But if banks were to develop some common strategy around this topic (perhaps related to the financial services passport concept that’s been discussed here before) then where should they start?

Well, what about the “adult identity”? Why doesn’t my bank put a token in my Apple Pay that doesn’t disclose my name or any other personal information, a “stealth card” that I can use to buy adult services online using the new Safari in-browser Apple Pay experience? This would be a simple win-win: good for the merchants as it will remove CNP fraud and good for the customers as it will prevent the next Ashley-Madison catastrophe. Keep my real identity safe in the value, give me blank card to top shopping with – a simple use case that will test the viability of the concept.

This article was first published on Tomorrow’s Transactions.

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David Birch

About the Author

About the Author: Dave is Director of Consult Hyperion, the secure electronic transactions consultancy and is an internationally-recognised thought leader in digital identity and digital money. Named in Wired magazine’s global top 15 favourite sources of business information; rated one of the NextBank “Fintech Titans”; voted one of the European “Power 50” people in digital financial services and ranked Europe’s most influential commentator on emerging payments. .

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  1. Avatar Bob Machin says:

    I’m in the ‘prat about and muck this all up’ camp, I’m afraid. RBS (to take just one example at random, not) make such a mess of looking after my bank accounts and seem so wholly incapable of managing the simplest personal information (such as whether I’m in or out of the country) that the idea of entrusting them with my ‘digital identity’ fills me with horror.

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