Portable digital identity solution with face biometrics successfully exits FCA regulatory sandbox
A reusable digital identity solution leveraging face biometrics and developed by Onfido, Deloitte, and Evernym has successfully exited a regulatory sandbox pilot with the UK’s Financial Conduct Authority (FCA), which the company’s say shows that portable digital ID is now market-ready.
Testing began in February 2019 as part of the regulatory sandbox’s fifth cohort, with the aim of evaluating whether reusable digital identity can improve customer onboarding journeys and reduce the compliance costs faced by financial institutions, according to the announcement.
The solution provides verified ID controlled by end-users through their smartphones that can be re-used across different services and organizations.
The ecosystem created by the three firms was built with input from the financial services industry and the FCA, and enables digital credentials to be used with different entities, as physical passports are accepted at all airports.
Under the model developed by Onfido, Deloitte and Evernym, credential providers verify relevant information about an individual or organization to issue digitally verifiable credentials, which are held on the credentialled persons phone, and shared or provisioned at that individual’s discretion with relying parties, which are typically institutions. The distributed nature, user control, and encryption reduce the risk of data breaches, the companies assert.
Given the regulatory constraints associated with financial services, meeting the FCA’s conditions marks a step toward creating the conditions for identity to serve as the key to access online services, the companies claim.
The pilot considered market appetite among end-users and service providers. Those testing the system were able to successfully open financial service accounts with their digital credentials, and more than half went on to reuse them. The majority of those participating in focus panels said they would recommend the solution to a friend.
“This pilot was instrumental in proving that portable identity significantly improves both consumer experience and protection, while accelerating customer onboarding and reducing KYC and compliance-related costs for financial institutions,” states Husayn Kassai, CEO and co-founder of Onfido. “Now that we’ve proven the model in one of the toughest regulated markets in the world, we’re rapidly proceeding to apply it to other geographies and services as well such as renting a car, self-checking into a hotel and one day, even voting.”
The companies note in the press release that Gartner has forecast decentralized identity to debut on the market in 2021, disrupting traditional access methods, and being used for a quarter of all bring your own identity (BYOI) logins by 2023. This will spur the industry from $50 million today to multiple billions by 2023, according to Gartner.
“The pilot has been a shining demonstration of how portable digital identity can transform markets and solve real business problems in a way never before possible,” says Steve Havas, CEO of Evernym. “When you put the individual in charge of her digital identity, everyone wins. It gives consumers the freedom to securely move about the digital world, and businesses the ability to finally know and trust who they are interacting with.”
Decentralized identity is a hot topic at the moment in several areas, including biometric travel credentials.
biometrics | bring your own identity (BYOI) | credentials | decentralized ID | Deloitte | digital identity | Evernym | facial recognition | financial services | Onfido | smartphones | UK