Organizations should approach blockchain digital ID by different methods. Consult experts’ opinions for a more comprehensive view of the solution.
Blockchain Digital ID has a far-reaching influence on the operation method of a variety of industries. Its emergence generates a deep relation to many of today’s identity systems, business models, and other technologies. Many discussions have arisen with the opinions of digital transformation experts.
Most of them expressed their confidence in this solution, but there are also concerns about the risks of applying new technology.
There are many players on the market, but below, we summarize some of the leading players’ opinions related to this topic, which represent the diversity of the digital ID blockchain approach on the market.
McKinsey focuses on exploring the impact of Digital ID on benefits in the banking and financial industries
McKinsey stated that a digital ID could help all people around the world, whether or not already own some type of ID, to access economic, social, and political activities with safety and effectiveness.
If done correctly, the digital ID provides a high level of verification and authentication, with uniqueness, personal consent, thereby ensuring user privacy, and the ability to control over personal data.
According to McKinsey Global Institute research, countries implementing digital IDs can unlock the equivalent of 3 to 13% of GDP by 2030. For banks, digital IDs can improve customer experience and increase productivity while improving risk management thanks to the e-KYC process.
Although McKinsey insists Digital ID has the potential to deliver significant benefits to both individuals and banks worldwide, managers need to be mindful of the risks that require well-designed and appropriate control methods.
The top risks of blockchain Digital ID that can happen when it is not well-designed include:
- Organizations can abuse the hype and ignorance of blockchain in the early stages to create unworkable projects, which are only fundraising without planning for the actual value.
- Risk related to human errors: Human errors can still happen to Digital ID on blockchain due to the new digital interface and lack of compliance rules when designing systems.
BiometricUpdate shows their support for the revolution of Digital ID
BiometricUpdate identifies Digital ID on blockchain as a growth engine for the applicability of biometrics to digital authentication.
This website shows that governments and organizations around the world are implementing many Digital ID projects. In their articles, they have listed a bunch of examples of Digital ID systems, surrounding the development of biometrics.
In the public sector, besides Australia, America, or China, Mexico has approved allowing the Department of the Interior to create databases with personal data of Mexicans, including biometrics. Collected social demographic statistics and information will help lawmakers to formulate public policies for the best benefits of the country.
In the airline industry, Star Alliance has developed a biometric platform with NEC technology to improve the experience of frequent flyers. AE Industrial Partners also revealed the launch of a seamless travel platform with a Digital ID system that applies biometrics in its development plan.
BDO recommends a risk-based approach with Digital ID
BDO – an UK’s audit, tax, and business consulting services firm – advises any organization planning to implement blockchain Digital ID using a risk-based approach.
Specifically, a risk-based approach digital ID system should include:
- The understanding of the level (s) of the Digital ID system assurance, especially regarding the authentication and identity verification process.
- Ensure that the assurance level (s) is consistent with the ML/TF risks related to the customer, product, jurisdiction, geographic scope, and test tubes.
Organizations also need a standard framework to ensure the independence and reliability of the source of information to ensure accurate results.
As an enterprise blockchain platform, akaChain recognizes the importance of developing Digital ID solutions. We believe opportunities and challenges are always present, especially with disruptive technology like blockchain.
Projects using our blockchain-backed Digital ID solutions for organizations will help maximize the potential of blockchain technology in business. At the same time, to promote blockchain’s applicability, we choose to provide BaaS (Blockchain-as-a-Service) to take advantage of an easy-to- integrated and rapid-deployment platform. This approach will also help companies save on the initial investment costs of a new digital management solution.
Consultation with other industry experts has given us a better insight into the future and direction of our enterprise blockchain solutions. Opinions about blockchain are varied and will become even more exciting shortly. We will always keep up with the latest news about blockchain and Digital ID.
Also, we are always welcome to all discussions on this topic, so don’t hesitate if you have any idea to follow up.
akaChain is backed by FPT Software, a globally leading technology, and IT services provider. It is an end-to-end, permissioned, multi-chain network based on the Hyperledger Fabric. Since Establishment in September 2018, akaChain product has assisted many enterprises, from SMEs to Fortune 500 firms, to transform with distributed ledger technology. The company provides a broad range of permissioned blockchain-based products and services in multiple sectors, including retail, supply chain, banking and finance, insurance, shopping mall management to transform with its distributed ledger technology. For more information, please visit https://blog.akachain.io/.
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