Identity theft is ugly. In fact, Javelin Strategy & Research finds in their 2017 Identity Fraud Survey that there were 15.4mm US fraud victims alone, resulting in $16B in losses. Meanwhile, card not present fraud jumped 40% over the prior year. This isn't surprising when you consider yet another survey by OnePoll. It found 71% of respondents write down their user names and passwords, 52% know at least one other person's PIN, 40% say at least 1 person knows their user name and password, 25% have never changed their PIN and 10% say they have given a bank card and PIN to a co-worker or friend.
The risk of identity theft and other types of fraud have pushed Deutsche Bank to take the lead in a universal digital identity project. Germany's largest bank announced it will be teaming up with well-known corporations in other industries, such as insurer Alliance, publisher Axel Springer, car maker Daimler and online banker Postbank, to create a single secure master key that would allow Internet users to transact their businesses online without needing to enter multiple passwords on different websites.
Deutsche bank and its partners expect to deploy their one-size-fits-all digital identities by mid-2018. At that time, their bank customers should expect, among other things, to be able to make and accept online payments and financial services using their unique pass key.
This coalition even wants to open its platform to public authorities. If that happens, local and federal government transactions could be accessible with the same ID. Furthermore, the pioneering companies will be able to negotiate with third party corporations and thereby extend their reach. For example, cellular provider, Deutsche Telekom is already in talks with Deutsche Bank. This experiment will be widely watched by banks and cyber thieves worldwide.
The project is designed to "increase legal certainty for clients and boost the European digital economy's growth," promises Deutsche Bank's deputy chief executive. Customers everywhere want a unique and secure solution for website access, but this is difficult to solve.
Clearly, a bank's authentication process needs to be reliable and safe. So, banks are a natural fit for certifying one's identity and data. You may be thinking that this is not an option for community banks due to limited resources. Yet, that may be a good reason to watch the progress of this project and possibly consider joining a similarly proposed US coalition.
If you are interested, opportunities may be available sooner rather than later, since universal digital identity projects are not confined to Germany. Big Canadian banks also announced that they are ready to work on a joint project and US bank USAA has been buying several digital identity start-ups to create new authentication tools.
The universal digital identity project hopes to keep customers safe and happy, while protecting against risk. It isn't yet time probably for community banks to jump headlong into this level of innovation quite yet, but it could be in the coming years.
In the meantime, keep educating your customers, protect your data and explore ever changing possibilities to secure your digital footprint and identity wherever it may evolve.