The Evolution of Digital ID
In today’s online world, the need for an effective method of digital authentication and identification is a priority. This type of identification refers to the information used to verify an individual or an organization and which is stored and accessed online. While digital ID was initially viewed as a simple security protocol, it has evolved into a means of effectively building customer engagement.
A Tool for Engagement
The inconvenience caused by authentication failures has a significant financial cost to businesses. A single authentication failure could cost a financial company an estimated $42 million , with this fiscal damage further compounded by a loss of customer confidence and reputational harm.
Today’s customers value a seamless, convenient, and reliable experience, particularly when it comes to their financial transactions. Organizations that cannot deliver this intuitive and personalized customer experience will lose out in the current market. Providing a simple yet secure means of digital authentication is, therefore, key to achieving better customer engagement.
The Cost of a Data Breach
The modern consumer is more aware than ever of the need to protect themselves against fraud and identity theft, and recent studies reflect this trend. 80% of customers actively prefer a brand that provides a robust method of digital identification verification , while 84% believe that the privacy of their personal data is an important issue for them and want better control over how organizations use such information.
Yet when data used for security purposes, such as digital authentication, is stored remotely on servers, there remains an inherent threat of cyber criminals. With hackers carrying out more sophisticated attacks, it can be hard to feel entirely confident that a customer’s sensitive data is safe from a potential breach. In addition to theft, this data can be used to steal customers’ identities. If such a breach occured, customers will inevitably lose faith in the organization responsible for keeping their information secure. There is also the risk of litigation and substantial fines, should data compliance regulations be found not to have been upheld.
Improving the Digital Authentication Process
The modern consumer demands a seamless and convenient experience, and this extends to the process of digital ID authentication. Current approaches to digital verification are certainly a step in the right direction, but they are not fully optimized. That’s because the need to store personal, biometric data on servers remains a key area of concern.
Biometric smart cards are a solution to this problem. These cards feature a fingerprint sensor that allows you to verify your identity with the tap of your finger. Biometric smart cards also provide a robust means of securely and reliably authenticating identity without compromising the convenient experience that consumers crave. Sensitive fingerprint data is stored on the card, eliminating concerns around server storage and potential cloud hacking. These cards could be the next step in building long lasting customer relationships and boosting engagement. We will explore this solution further in the next post.