More and more transactions take place online and as a consequence identity services will follow suit. Nevertheless, when it comes to valuable or trust-based transactions we often revert to paperwork and an offline ID to be sure of the other person’s identity and legal status.
This will change in the near future. Technically, various methods to digitally determine somebody’s identity and legal status have become available in most European countries. Yet, their acceptance is not so widespread yet.
Although we are still in the middle of a transition from the physical to a digital identity, it is an irreversible development going forward. In 10 years time we will look back and wonder why we ever put so much trust in paper-based administration and a card-ID when you can have a secure digital ID.
Legislation is key
If we compare the current status of our digital ID to cross-border payment transactions within Europe 10 years ago, it shows a lot of similarities. Everything was organised locally and European transfers were considered international and therefore could take days. Then, in 2008, SEPA was introduced to turn domestic transfers and direct debit products into European standards.
However, nothing much happened until 2012 when the European Commission made SEPA mandatory in all member states to speed up the transition. That was the actual beginning of a series of rapid developments making European transfers equal to ‘local’ transfers with regard to usage and processing time. Now payments are credited to any account in Europe within a day. Even more importantly, consumer’s trust in European payment transactions has grown.
For digital identity the European Commission has been working on legislation as well: electronic IDentification, Authentication and trust Services regulation (eIDAS) was introduced in 2014. This regulation ensures that electronic signatures and other trust services are legally valid across European borders and have at least the same legal status as traditional paper-based processes. As from September 29th, 2018 all European citizens and companies must be able to log in to organisations in the public sector in other member states with their national ID. This is a good start and needs to be enforced for organisations outside the public sector as well, of course.
Conditions for success
So, legislation is key. Not only as a good starting point but as a necessary framework to build on. Nevertheless, before e-identity becomes common ground, other conditions need to be met as well. Apart from legislation, the European Commission and national government should provide for a few other conditions to speed up the acceptance of an e-identity.
Condition 1: Wide distribution
End-to-end processing will only work if all constituents in the process have an e-identity. Only when every European citizen has an e-identity, this becomes possible. At this moment several EU countries do not provide an e-identity for their citizens yet. The European Commission and national governments need to implement this.
Condition 2: Interoperability HUB
As every country in Europe has its own identity scheme, a hub will be required until all European citizens have the same kind of e-identity. As a merchant you want to be able to trust the identity of your foreign customers, even though you are not familiar with their IDs. Like a travel plug, this HUB or tool will adapt to all countries.
The government is working on such an identity interoperability initiative, called STORK 2. However it is currently in development and for governmental usage only. Ideally, such a HUB would only be a temporary requirement within Europe, as, in the end why would the member states not agree on one common European e-identity?
Even then an interoperability HUB will always be necessary, when it comes to trading with countries outside of the EU.
Condition 3: Trust
Trust is another condition for overall acceptance, although this is mostly a matter for the less tech-aware generation. The tech-savvy generation already realises an e-identity is actually more secure than a paper or plastic ID card. The e-identity is far better protected than its paper version: to access you e-dentity you typically need something you know (your code), something you are (your fingerprint), and something you have (your smartphone). And when your e-identity gets stolen or lost, it can be blocked faster than a traditional ID card.
Once this is understood and with the European and local government backing e-identities with the mentioned legislation and conditions, trust will grow with the older generation as well.
The future identity
Taking SEPA as an example, we see trade can grow faster internationally if legislation and other conditions are put in place to foster general acceptance. But rest assure, once these are met, it will go fast. Probably, in 10 years time we will look back and wonder what took us so long.
Author: Nicolas Metivier, General Manager EMEA Connective