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With just shy of 50 per cent of Australians now comfortable with the concept of digital IDs, momentum is building for a major shift in the way people verify who they are to organisations.
Australia has reached a pivotal moment in attitudes towards authenticating and verifying identity.
This is, of course, no accident; like many countries, Australia has experienced a stream of large-scale data breaches that have impacted the personally identifiable information of hundreds of thousands to millions of people at a time.
The investigations into many of these incidents look remarkably similar: organisations that, for legal or compliance reasons, captured and stored identity documents for years after the original purpose or intent expired — a period of time that was often out of step with people’s expectations.
These events have permanently shifted people’s attitudes towards data privacy and security, with 77 per cent feeling they will never be fully in control of their personal information online. It is not surprising then that anything that empowers individuals with control of their own information is going to be considered carefully.
The Australian government has read the room and recognised that it is time to act: its recent myGov user audit, among other things, recommended an acceleration of the “development of Australia’s national digital identity ecosystem, prioritising the protection of security, privacy, safety and other human rights”. Digital identity legislation, on some estimates, could be before the Australian Parliament before the end of the year.
Until then, we can expect more industries’ identity and privacy practices to be placed under the microscope, with adverse findings adding to the pressure on authorities to act sooner rather than later.
The rise of digital identity ‘documents’
The large majority of societies worldwide verify their identity through physical government-issued ID cards, although there is often no digital equivalent to physical ID cards.
We believe that will start to shift, with major progress towards decentralised identity — where individuals possess and control their own digital identifiers. These digital IDs are issued by authoritative bodies that verify a person’s real-world identity and provide digital proof of identification for an individual to present online.
Juniper estimates the number of users of digital ID “documents” globally will grow from 4.2 billion in 2022 to over 6.5 billion by 2026, a growth rate in excess of 50 per cent. The analyst firm believes this will be driven by a combination of post-pandemic attitudes and due to “the growing importance of digital identity in sectors such as government services.”
Ping Identity provides additional contextualisation around these bullish growth projections. The research shows 48 per cent of Australian consumers are already “comfortable” with the concept of using digital ID. This is the second-highest result of all countries in the survey — only a single percentage behind the US, where comfort levels are at 49 per cent. Notably, this result is also higher than the global average of 43 per cent.
If users can present pre-authorised digital IDs to perform a transaction online or in person, enterprises will no longer need to take on the role of storing and managing user data. With this burden alleviated, enterprises can save money and reduce the risk of reputational damage caused by breaches.
Digital IDs also allow enterprises to provide better user experiences. Rather than requiring users to complete lengthy registration forms or applications, enterprises that embrace decentralised identity can have customers scan a QR code, for instance, to provide all of their needed identity information.
Numbers have been fairly consistent over the years — above 60 per cent of consumers say a cumbersome login experience alone — even without the security and privacy implications — would drive them to switch to a competitor’s services. And the thing about this is consumers do follow through: 59 per cent have abandoned an account or online experience due to a “frustrating” login process. A customer experience that favours both simplicity and privacy can put organisations ahead of the pack.
The reasons and drivers are clear for governments and regulators to clear the path for decentralised identities to become an acceptable form of identity verification. Such IDs are favourable to users who value the ability to control their own personal information. Possessing them allows users to protect their personal information and share only what they want to provide.
For organisations, accepting them means collecting and storing less personally identifiable information while still fulfilling due diligence and risk requirements.
Ashley Diffey is the vice president of sales, Asia-Pacific and Japan, at Ping Identity.
David Hollingworth has been writing about technology for over 20 years, and has worked for a range of print and online titles in his career. He is enjoying getting to grips with cyber security, especially when it lets him talk about Lego.
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