Identity systems of the 20th century are completely useless in this digital age, says Chris Skinner. We need something better.

Kamila and ChrisThis is my wife. She doesn’t know she’s appearing on my blog today, but it doesn’t matter because she doesn’t exist. Well she does physically, but according to my bank she doesn’t exist. I only discovered this recently, due to trying to open a new joint investment account. To open the account, the bank asked me to come in with identity documents – a passport or driving licence, and at least two utility bills showing my name and address.

This was no issue for me, but for my wife it proved to be very difficult. First, due to having children, she had stopped travelling and her passport had expired. She has a driving licence but passed her test in Poland, her home country, and a Polish licence isn’t recognised by a British bank as a valid ID. She doesn’t pay any utility bills and only has a bank statement in her name. However, she signed up for e-statements and these are not recognised as a valid name and address bill due to being a printout and not a real statement. Oh dear.

What do we do? My wife apparently doesn’t exist. This isn’t just an issue for her, but an issue for around 2.5 billion people around the world. Due to the fact that their birth was never recorded and that they haven’t needed to show any official ID, they don’t exist. This is a dream for human traffickers, as they can abduct people who don’t exist really easily. Equally, as I noted a year ago, even if you do exist, it’s easy to make you disappear. I just destroy your documents.

Self-sovereign identity

I’ve thought about this quite a bit during my travels. For example, I often go jogging on the streets of the countries I visit and thought one day that if I was hit by a lorry or car while jogging, how would the hospital know who I was? How would they track me down? Would anyone know that I’d disappeared?

It’s not obvious is it? When jogging, I have no ID on me. As a result, I’ve had my name, social security number and birth date tattooed on my arse just in case. Just kidding, but you get the idea. What I actually do is wear an ID bracelet when travelling … just in case.

But identity is a really tough area that’s incredibly badly managed. Yes, there are many people who don’t exist, but even when you do exist, it’s pretty ineffective, as just outlined. Steal my passport or lose my driving licence and who am I? How do you know it’s me?

Even if you do exist, it’s obviously easy to buck the system, as evidenced by that stunning statistic of $1.6tn being money laundered through the banking system, and only 2% actually being tracked, traced and caught.

Nope, identity systems of the 20th century are completely useless in this digital age. We need something better, and I’ve referred to self-sovereign identity schemes a few times now (most recently related to the Equifax hack).

Anyways, I thought the point was illustrated particularly well by my nonexistent wife, even though I can see her and touch her. Shame she doesn’t exist.

READ NEXT: Why can’t digital identity be easy, like payments?

– This article is reproduced with kind permission. Some minor changes have been made to reflect BankNXT style considerations. Read more here. Image by ktsdesign, Shutterstock.com

About the author

Chris Skinner

Chris Skinner is an independent commentator on the financial markets through the Finanser, and chair of the European networking forum the Financial Services Club, which he founded in 2004. He is an author of numerous books covering everything from European regulations in banking through to the credit crisis, to the future of banking.

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