By Robert Hann, VP Sales Global, at Entrust
Over the last year, GenAI has fuelled a boost in digital forgeries. So much so that it now accounts for 57% of all document fraud, a staggering 244% increase over the previous year, according to recent research.
With identity fraud surging and digital interactions becoming fundamental to daily life, static identity systems, wherein personal data is stored in large, centralised databases, have become a honeypot for attackers. From the UN’s aviation agency to American ticket and sales platform, Ticketmaster, millions of people have fallen victim to data breaches that have revealed sensitive and private data.
Thus, a more secure approach is needed, one which will work to put end users’ sensitive identity and data security first. Shifting to a dynamic digital identity, where identity data is constantly verified and decentralised, gives individuals more control over their personal data and reduces vulnerability to attacks, all while enabling low friction verification and authentication.
Embracing Dynamic Digital Identities for Stronger Security
As the fraud landscape evolves, digital identity systems evolve in tandem. Instead of relying on outdated systems, dynamic identities are constantly verifying who we are, using advanced tools like biometrics and behavioural analytics. This means fraudsters are faced with more difficult, ever-moving targets.
Blockchain-powered identity wallets, which puts control back to the identity owner, provides strengthened protection by ensuring that information is less vulnerable to exploitation and breaches. Using encryption and digital keys, these systems let users confirm their identity without revealing the valuable sensitive details that cybercriminals and fraudsters are after. It works by obscuring personal information right at its source, allowing consumers to see and revoke access to their data at any time. Instead of simply storing everything in a central government database, which can be an easy, static and appealing target for fraudsters, users can securely keep details like their date of birth or address contained within a digital ID wallet. This system makes it much harder for hackers to target individual digital identities compared to traditional database storage methods.
The beauty of this approach is that it completely transforms the paradigm of data privacy. It puts control of private data back in the hands of the people. By embracing this shift, individuals gain tighter control over the information they share, while organisations can address rising concerns around data ownership. To make this system work, individuals need to understand how it operates; this is where the UK government would need to focus on education and awareness in order to win the hearts and minds to make any digital identity rollout a success. Equally, consideration should be made towards being open and allowing citizens to choose their ID wallet e.g. Apple, Google, Samsung etc.
In Action: How are Dynamic Digital Identities Being Embraced?
Financial institutions are already embracing the shift towards dynamic, digital forms of identity, driven by the need for convenience, security, and efficiency. As customer expectations and the threat landscape evolve, banks and financial services are moving quickly towards AI enabled biometrics, such as facial recognition and fingerprint scanning, alongside verifiable e-IDs, when available, to verify identity. The UK government has also started to embrace digital IDs with the recent announcement of a digital document app, launching this summer. This initiative aims to provide a secure and simple way for people to verify their identities online and at the point of need.
Globally, governments are recognising the importance of digital identities; according to research, over 57% of citizens from select G20 countries (the UK, US, Australia, Canada, France and Germany) prefer to conduct interactions digitally, including 39% who specifically referenced accessing government web portals digitally. The European Union has developed and launched frameworks that will guide EU citizens and businesses who want to securely identify themselves digitally. BankID in the Nordic countries is great example of a success story as a widely adopted e-ID system and was launched in 2004. It was initially driven by banks and later supported by governments for accessing both financial and public services. BankID is currently undergoing a migration to a more versatile and user-friendly ID wallet format which aims to enhance user experience, security, and functionality, aligning with broader trends in digital identity and the European Digital Identity Wallet initiative.
While there are valid concerns surrounding digital identities in the UK, a well-managed rollout of the government scheme could significantly enhance identity security. British consumers, whilst naturally sceptical about ID cards, particularly when associated with GOV UK, are likely to embrace modern wallet based digital identities if they provide convenience and ease of use. To ensure that people’s data is kept secure, the success of the government ID rollout is dependent on embracing dynamic digital IDs rather than a centralised database or “honey pot” for adversaries to breach. The government will need to adopt a blockchain-based model; with the right security measures in place, digitising identities will not only help reduce friction for the UK consumer but also keep up with the modern approaches seen across Europe.
Static identity systems are no longer fit for purpose in an era of rising digital fraud and interactions. As technology advances, so too must our approach to identity verification. By embracing decentralised, dynamic digital identities, individuals gain more control over their personal data, while organisations and governments can embrace more robust security measures without sacrificing user convenience. A well-implemented system that puts blockchain, biometrics, and encryption at the forefront will not only weaken hackers but also empower consumers to engage with the digital world safely and seamlessly.
