Confirming Digital Identities
A recent global survey found out that 69% of consumers living in countries with a significant history of online fraud are concerned about their security when doing online transactions. The survey further found out that 51% were less likely to do any online financial transactions, with 47% stating that they were making fewer online purchases than expected. The findings of this survey are a clear indicator that both online sellers and buyers want to confirm who they are engaging, with the primary objective of verifying their identities. After conducting our research, we were able to identify how small businesses and individuals confirm each other’s digital identities when shopping online and how these practices are expected to change in the next five years.
How small businesses confirm the digital identities of their online buyers
Because of their financial limitations, many small online businesses rely on the thousands of data sources available worldwide to confirm the digital identities of their respective online buyers. With the help of government databases and credit bureaus, many online sellers manage to get and confirm their buyers’ digital identifications. For example, according to a recent World Bank report, 82% of all the countries that issue national ID cards have rolled out electronic ID programs (eID) and most of these countries already have digital ID schemes tied to various functions. With many countries adopting the digital IDs, many small businesses are taking advantage; a good example is Australia and other developed countries, where online sellers can download apps to verify the digital IDs of their online buyers. Some notable aspects that an online seller is able to confirm include the photo of the individual, the date of birth, which confirms the buyer’s age and other security features.
Smaller businesses also confirm their online buyers using new technology sources that include mobile network operators, social media, internet of Things (IoT), mobile apps, and biometrics. Some of these identified sources easily enable small online businesses to identify and verify their online buyers and thus get a clear picture of them. On the other hand, small businesses that have professional online presence use an authentication code, biometric data point, and the date of birth to identify and verify their online customers. Other online sellers have devised other innovative ways that enable them to profile their buyers’ interactions, and when they notice changes in their customer’s behaviors, they act promptly to protect both their interests and those of their respective customers.
How individuals confirm the digital identities of their small business online sellers
Individual online buyers confirm the digital identity of the online sellers by looking for reviews at Yelp, Facebook or any other social media sites where they can see the feedback of the previous customers. Other notable ways that the individual confirms the digital identity of their online sellers and particularly small businesses is through sites such as Ripoff Report where previous customers identify businesses that they have had difficulty engaging with, while purchasing online products or services. Others have sought to confirm the digital identity of their online sellers by verifying their information such as the phone number or the email address, with the objective of establishing whether they are legitimate. With modern-day technologies, online buyers are able to confirm online sellers with the help of traditional methods such as business registries and government databases. Newer sources such as mobile apps and social media have proved pivotal for individuals to verify their online sellers.
How these practices are expected to change or evolve in the next 5 years
#1. Expansion of national ID schemes and federated digital identity
Research by Gemalto revealed that by 2021, the number of electronic National ID cards would reach 3.6 billion globally. This will play a pivotal role for both small businesses and individuals engaged in online businesses, for instance, the federated digital identity would enable the linking of a customer’s digital identity and attributes. This data will be stored across management systems and thus become a new normal that will balance the consumer security and convenience. On the other hand, Acuity points out that robust eID system will provide excellent opportunities for global, regional, and national transaction infrastructures, secured by a digital identity that is trusted.
#2. Increased use of biometrics
According to Google intelligence, there will be at least 120 million online customers using mobile biometrics every day by the year 2020. In this aspect, biometrics will continue to advance in the coming years as an identity verification technology. This development will see a continued migration to new digital identification systems and the end of security breaches currently linked with the use of passwords.
#3. Digital identity will be more mobile in the future
Numerous indicators and signs show that mobile phones will be the most secure digital identity solution in the future. Presently, mobile phones have all the components that are required to take all the aspects of digital identity in the next few years. With a combination of mobile apps, both small business online sellers and individuals engaging in online businesses will easily identify each other digitally.