Reworking identity solutions for the digital world

As innovation accelerates and new privacy regulations are introduced, the need for digital identity is clear. How can Australia prepare for the future?

The internet, the economy and the world around us are rapidly evolving. The rise of a digital society is all encompassing, transforming the way we live, work and interact with each other. By enabling connectivity, access to information, economic growth, efficiency and social benefits, a truly digital society has the potential to create a more inclusive and prosperous world.

In this landscape, Australians need to do everything they can to protect their data, especially from instances of fraud. The role of digital identity can’t be understated, providing a reliable and secure way of verifying the identity of individuals. As innovation accelerates and new regulations are introduced (such as those flagged in the Australian Government’s Privacy Act Review Report), the need for digital identity is clear, but how can Australia prepare for the future?

 The identity conundrum

A current problem is that identity verification processes are not designed as a user-centric experience. A poor user experience due to a lack of simplicity, consistency and constant repetition ultimately leads to customer dissatisfaction.

The increasing number of data breaches and incidents of identity theft may also mean consumers are hyper-aware of the privacy and security implications when sharing personal information online. They may hesitate to share sensitive information or participate in digital services due to the potential risks associated with identity theft and unauthorised access.

While digital identities are extremely beneficial, there is still a lot of work to do to achieve nationwide adoption. For example, digital driver licences were introduced in South Australia in 2017, in New South Wales in 2019 and have very recently been trialled in Queensland. While the digital driver licence is a convenient solution, the complexity of implementation and the need to address security, privacy, legal and technical considerations all contribute to the time it takes to roll out such systems statewide, let alone interstate.

Furthermore, the issues of user control and consent have emerged as pressing concerns when it comes to digital identities. A survey conducted by the Office of the Australian Information Commissioner (OAIC) in 2020 revealed that 9 in 10 Australians want more control over their personal information. This statistic demonstrates the ongoing concerns about data ownership, transparency and consent that can lead to consumer friction and distrust in digital systems.

On the other hand, in today’s digital age where consumers shop, watch, game and engage online, each interaction inevitably leaves behind a trail of personal data. In a limitless digital world, it has become increasingly unclear for consumers to understand what it means to ‘be in control of their identities’, or how to ensure the data they share is done so with full consent.

The adoption and interest in digital identity over time

Businesses of all sizes, along with consumers, will benefit from the development of digital identities. With the public and private sector intent on driving the adoption of digital identity, we’re likely to see adoption rates continue to increase.

 For Australian businesses, increased penalties are now being imposed for failure to comply with the Privacy Act. Along with heightened media interest in data breaches, this means that the matter of cybersecurity is of greater interest to the C-suite, and a significant focus for the boardroom in 2023. The introduction of digital identities promises to better protect businesses, as well as address the broader concern around consumer trust, which has been derailed with increased focus on how data is stored, and nationwide calls for increased transparency.

For consumers, digital identity provides a secure and trusted means for them to better control the data they share, ultimately enhancing their online experience and reducing the potential to overshare. By eliminating the need for cumbersome paper-based identity verification methods, digital identity offers exceptional convenience. With a simple click, the time-consuming process of retrieving stacks of legal identity documents and completing paper forms becomes a thing of the past. This ease and efficiency enable users to swiftly verify their identity and access essential services like banking and government benefits.

Considerations for the future

Establishing a robust digital identity framework holds numerous benefits for Australia. By fostering trust and minimising risk, the significance of industry-wide frameworks, such as the Australian Government’s Trusted Digital Identity Framework (TDIF), cannot be overstated. When delivered well, with interoperability in mind, these frameworks enable public- and private-sector initiatives and collaborations within Australia.

 Taking an inclusive economy-wide approach, leveraging open technical standards, allows for simple integration and encourages continued growth and innovation across different industries. This approach, backed by the adoption of reusable credentials, proves to be an asset in the digital society. It provides greater control, and transparency, and enhances privacy and security throughout the entire process.

As more and more aspects of our lives move online, from banking and health care to social interactions and entertainment, the need for secure and reliable digital identity solutions has become increasingly important. Above all else, a simple, smart and secure way to keep life moving is needed where consumers have greater control of their data.

Image credit: iStock.com/Jirsak