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Australian banks move towards private digital identity products as legal issues debated

Australian banks move towards private digital identity products as legal issues debated

Australia is debating new laws that could make its long-awaited national digital identity scheme a reality. As the national digital ID plan slowly drags on toward legal codification, financial organizations are searching for faster solutions and looking towards private identity services.

The Commonwealth Bank of Australia (CBA), one of Australia’s largest banks, announced last week it has joined digital identity service ConnectID which allows users to prove their identity online to merchants and other businesses. The news comes after the National Bank of Australia (NAB) also allowed its customers to use ConnectID.

The CBA is planning to use ConnectID to allow its customers to verify their identity using face biometrics through its CBA app. The tie-up suggests that banks may have run out of patience with government schemes, according to The Mandarin.

The digital identity service is a product of a collaboration between AP+ (Australian Payments Plus), digital identity solutions company Eftpos, payments platforms BPAY and the New Payments Platform (NPP), a subsidiary of AP+.

The solution is meant to provide an alternative to government digital ID schemes and is geared towards consumers. One of its features is data minimization, according to Andrew Black, ConnectID managing director, who recently spoke with Biometric Update about the service.

ConnectID was the first non-government operator accredited by the Australian government under the Trusted Digital Identity Framework to deliver digital identity exchange services in the country. The federal government has been trying to entice private sector participation in the TDIF since 2018, drawing in Australia Post, Eftpos, OCR Labs (now IDVerse) and Mastercard, according to The Mandarin.

Legal debates continue over Australia’s identity matching services

Legal experts are warning that Australia is rushing a new bill designed to regulate identity verification services, leaving issues such as privacy unresolved.

Known as the Identity Verification Services Bill 2023, the legislation allows the government to provide government data sources for identity verification services, including biometric facial matching. The new legislation is supposed to pave the way for the country’s upcoming digital identity ecosystem, alongside other upcoming laws such as the draft Digital ID Bill.

While the Identity Verification Services Bill has been welcomed in legal circles, some experts are warning that the government is hurrying the legislation in order to fix a gaping legal loophole without leaving the necessary time for consultations.

The Australian parliament introduced the bill and accompanying amendments on September 19 and opened consultations which ran until October 10. The Law Council of Australia, however, warned that a 12-business day consultation period was unreasonable, leaving no time to analyze the bill’s impact on human rights, InnovationAus reports.

“There is no opportunity for individuals to opt out of being subject to these schemes, placing an even greater onus on the government to ensure that adequate safeguards and oversight mechanisms are in place,” the Council said last week in a submission to the new bill.

Another legal organization, the Human Rights Law Centre said the Bill should wait until Australia updates its now-obsolete privacy laws to to include stronger protections.

Australia first tried to introduce legislation for identity verification services in 2019. After criticism over privacy and transparency standards, however, the bill fizzled out. One of its main points of contention was the option of using one-to-many (1:n) biometric matching capabilities that would allow authorities to mine facial recognition records from many sources.

The newest version of the legislation seeks to introduce greater protections by allowing one-to-many matching only for special purposes such as protecting the identity of persons with a legally assumed identity, such as undercover officers and protected witnesses.

Last week, however, the Digital Transformation Agency (DTA) warned that allowing one-to-many face biometric matching, even in extremely limited circumstances, could put a chill on digital ID adoption in Australia.

The current bill authorizes 1:1 matching of identity through identity verification services such as the Document Verification Service (DVS), which verifies biographic information such as a name or date of birth, and the Face Verification Service (FVS), which allows a person’s photo to be biometrically matched to their identity documents. In addition, the National Driver Licence Facial Recognition Solution (NDLFRS) enables the Face Verification Service to match citizens using identification documents such as driver’s licenses.

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