Written by Rob Laurence, Innovate Identity
Our society promotes a spending culture where our need for instant gratification leads to borrowing and credit fuelling at the expense of saving and investing in our futures. The figures speak for themselves, as 30% of households have no savings at all. Even if you do want to save, it can be a challenge to take out a new savings product. Any application started online will still often result in being taken offline as providers require physical evidence of identity before accepting our money. Compare this with taking out a personal loan which can be done in minutes with money in your account in a matter of hours! It’s easier to borrow than save!
The Tax Incentivised Savings Association (TISA) sponsored an OIX Discovery Project involving L&G and LV from the savings sector and the digital business transformation consultancy, EY-Seren, to examine whether digital identities could help transform consumers’ attitudes and behaviour towards saving.
This project explored the use of GOV.UK Verify in two use cases: the first to open a savings product with a new provider, the second to transfer savings from an existing to a new provider. Could the use of a digital identity remove hassle for the user and streamline the way in which AML Customer Due Diligence checks could be carried out? Would customers welcome this? Could digital identities underpin the development of new services perceived by customers to be of high value and encourage them to be more active in the savings market?
There were some very interesting key findings that came out of the user research.
1. Almost half of participants had abandoned a savings account sign-up process as it was too much hassle
2. Participants were positive about using digital identities as it was convenient and, if the government was involved, there was a sense of trust
3. The 10 minutes taken to register for a digital identity was worth it as the identity could be re-used later
The project also considered the use of a GOV.UK Verify-like scheme more generally in financial services and whether a digital identity in a wider context could lead to savings in identity assurance and regulatory compliance checks and underpin the transformation of business processes. The paper concludes that, whilst there are many areas that would need to be addressed by the industry collectively, a digital identity scheme has significant potential and deserves further exploration.
Digital identity schemes could have far reaching implications to the UK economy that go beyond the savings sector as the cost of identity assurance could be slashed from £1.65 billion to £150 million in the UK. You can read the full whitepaper here
Innovate Identity was delighted to be asked by OIX to coordinate this project and write the white paper. We provided project management services and subject matter expertise in the field of digital identities, privacy and money laundering regulation. Want to find out more about what we can do? Send us an email today, we love a chat!