The internet is an integral part of daily life. The global average time spent on social media daily is around 147 minutes. Looking at it from another perspective: if you begin using social media on January 1 and keep scrolling, you will only put your phone down by the early hours of February 7.
With the amount of time spent navigating through the online space, a user’s digital identity has become more valuable, requiring protection to prevent fraud and identity theft. According to identity theft statistics, almost 1,300 data breaches were reported in the first three quarters of 2021.
Such instances are costly, too—victims lost an average of $1,100, while businesses lost more than an estimated $7.2 billion. These numbers highlight the need for better digital identity protection and management.
A more comprehensive discussion about digital identity, digital identity verification, their use cases, and how to keep them safe is needed.
What is Digital Identity?
If your appearance is physical identity, then what is digital identity?
A digital identity is a set of collective information online—login credentials, purchasing behavior, search history—that represents an individual, organization, or electronic device. You may have multiple personas spread across different platforms, but you only have one digital identity.
With the amount of personal data shared online, safeguarding digital identity is paramount. Users must be careful with what they share online or risk exposing themselves to hackers stealing their personal information. This is why some groups have adopted a self-sovereign identity, which uses blockchain to allow them to own their data entirely.
Digital identities are also crucial for businesses. Unauthorized access to their services can wreak havoc on their operations and tarnish their reputation. This is why many establishments and organizations ask users to undergo digital identity verification.
What is Digital Identity Verification?
Digital identity verification is the process of confirming that a person’s real identity matches their online claimed identity or digital identity. Since hackers are skilled at impersonating users and accessing their personal information, organizations must go through this process to protect both parties.
Financial institutions especially undertake this process to combat fraud, money laundering, and unauthorized access to their services, which is part of Know Your Customer (KYC) compliances and anti-money laundering (AML) practices.
Digital ID Verification Methods
Digital identity verification comes in many forms, all of which aim to confirm that the individual is who they say they are. Below are the most common ways businesses or establishments may ask to verify identity.
Users must provide official government documents to verify their identity when creating their online profiles. Standard documents include driver’s licenses, passports, and other government-issued IDs.
For example, volunteers who enroll in the Q5id Guardian app are required to present a government ID. The app scans the ID and uses optical character recognition (OCR) and barcode decryption to automatically pre-populate the sign-up form with the volunteer’s personal information.
Biometric verification uses an individual’s unique physical traits—fingerprints, retinas, facial features, and palm veins—to verify their identity.
Knowledge-based authentication (KBA)
Services that use KBA will ask security questions to whoever is accessing the account. These questions are also known as out-of-wallet questions in which the answers cannot be found on public records. It works on the premise that only the account’s true owner will know the correct answers.
The questions and answers are typically set up upon account registration and can range from Who was your favorite teacher? to In what city did your parents meet?
One Time Password (OTP) verification
A unique code will be sent to the user, typically via email or SMS, which they must input to verify their identity. OTPs expire within seconds or minutes, so users must use them immediately.
Facial liveness detection
Facial liveness detection asks users to open their camera and perform a randomized set of simple tasks such as turning their head, opening their mouth, or blinking. Facial recognition is often exposed to presentation attacks, such as using a static image of the user’s face or deepfaked videos.
Individuals may use the information they provide to a third-party like social media platforms to verify their identity. This method typically sits low at the digital security verification totem pole as hackers can easily spoof social media profiles.
Digital Identity Use Cases
With how significant the internet is to daily life, businesses and governments aim to integrate digital identity verification into their services to improve efficiency and security.
Digital identity verification plays a role every time a transaction occurs online, whether checking out of an ecommerce cart, transferring funds to other bank accounts, or interacting with insurance providers. Ecommerce platforms may also use digital identity to tailor product recommendations based on a person’s viewing and buying behavior.
Online gaming operators verify the digital identities of players before allowing them to bet. This process protects the business from players that may bet another player’s money or withdraw from others’ accounts elsewhere.
Governments worldwide are slowly adopting digital identities as a single source of truth for their citizens. These digital identities are given identifiers or reference numbers unique to the individual, increasing efficiency by reducing documentary requirements and paperwork and encouraging citizen participation during elections.
Airlines and hotels benefit from digital identities since they can help personalize people’s travel experiences. Travel websites may also use them to tailor their recommendations to the user’s taste.
Hospitals use digital identities to keep track of patients’ medical records, sensitive information, and insurance. This makes it easier to connect with doctors and book checkups.
7 Ways to Protect Digital Identity
As more countries and industries adopt digital identities, cybercriminals will continue to lurk online, innovating their hacking methods. Here’s how your clients can safeguard their digital identities.
1. Install security software
Since it can be challenging to stay vigilant while browsing the internet, installing security software can help. Software such as VPNs on a computer or smartphone can encrypt connections to make it safer for people to transact online.
2. Update all apps
App and operating system developers regularly roll out updates for their products. These include patches that fix security bugs, making the latest versions the most secure. Keep apps updated to protect against hackers exploiting security holes in the outdated apps.
3. Use multi-factor authentication
Multi-factor authentication (MFA) will require users to go through multiple layers of verification before they can access their accounts. These can include biometric, KBA, and OTP authentications. Additionally, authenticator apps provide time-sensitive codes they will need to input before logging in.
4. Avoid unencrypted connections
Hackers can easily steal personal information by accessing unencrypted connections. Avoid visiting websites with only HTTP in their URL; HTTPS connections use TLS/SSL, which are more secure and safer to visit. It is also recommended to avoid connecting to public Wi-Fi as they are considered unsafe.
5. Limit what to share online
Since digital identity is information shared online, it can be traced back to the user, so being more selective with posts is essential. If possible, users must avoid sharing location data as anyone can use that information to track the places visited and their residence.
Always do a background check. Audit social media profiles and emails to remove information that must not be public. Gmail users can review which websites or apps are linked to their email through their Google account dashboard, under the Security tab and Manage third party access section.
6. Create stronger passwords
Follow password best practices such as mixing characters, increasing complexity, and making each password per account unique.
Alternatively, choose passwordless solutions to avoid retyping passwords when logging in. Instead of a traditional password, use solutions offered by Q5id that incorporate MFA including biometrics as part of their authentication process, to access accounts. Besides being more secure, passwordless authentication means not having to remember various login credentials.
7. Dispose of paper documents thoroughly
Billing statements may be haphazardly thrown away. These documents often contain sensitive, personal information which can be exploited online. Block out personal information before disposing of legal or sensitive documents or checks. Shredding will also make them unrecoverable once they’ve been disposed of.
Keep Digital Identities Secure with Q5id
Securing digital identities is crucial since so much of daily life revolves around the internet. Unprotected digital identities expose people to hackers trying to access personal accounts online, such as social media profiles or digital bank accounts.
Businesses and individuals can benefit from a secure identity proofing system to keep safe in the increasingly digital world. If you are looking to strengthen your digital security, it’s time to work with cybersecurity experts at Q5id. Our identity and access management services will help safeguard digital identities.
Contact us to learn how we can help you.
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