The proliferation of technology, the growing interconnectedness of communities and the insatiable appetite for ultra-convenience appears to have spurred an explosion in investment in digital identity solutions across the globe.

National governments and private players have poured hundreds of millions of dollars into digital identity.  In 2019 alone, the Australian Government invested over $65 million into the “myGov” initiative. This is in addition to the $92 million allocated in the 2018 budget. The initiative is part of the Digital Transformation Agency’s broader multi-billion-dollar Digital Identity Program, which aims to provide Australians with a central digital identity when accessing government services. By 2025, all government services are expected to be made available via digital channels, accessible through a secure digital identity credential. The credential will enable the government to establish and operate a “tell us once” platform which will allow users to share their details across the federal government agencies without having to contact each one separately.

Digital Minister Michael Keenan expects the program to save the government tens of billions of dollars each year, easily recouping the multi-billion-dollar investment in the program.

The private sector has also been busy investing in Digital ID. With the rise of open banking, the Australian Payments Council has invested heavily in digital identity and is collaborating with the financial sector to create a framework for participating organisations to establish a secure, accurate and verifiable digital identity process. The framework is expected to be completed later this year.

The adoption of digital identity solutions promises great benefits for individuals and economies. Nevertheless, the rise of Digital ID has also brought the need for security and privacy to the fore.  Digital ID systems house large amounts of highly sensitive data in a consolidated and interlinked manner. This poses significant risks from a cybersecurity perspective. Recently, India’s national ID database, Aadhaar, suffered multiple data breaches which led to the records of almost 1.1 billion Indian citizens to be compromised in the first half of 2018. Within days of the compromises, the personally identifiable records of millions of Indian citizens were discovered for sale on the dark web. It’s a sobering reminder of what can happen if digital ID is done poorly.

There will always be a level of trade-off between convenience on the one hand and security and privacy on the other. The challenge for governments and the private sector alike is to develop digital ID initiatives that have human-centric design, secure systems and customer privacy at its heart.

Authors: Kirish Kularajah and Sophie Tversky

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