In one of the most innovative developments of its day, several Canadian banks joined forces some 30 years ago to create the single shared Interac network. Reaching across the country, the Interac network overhauled the payment system and gave consumers instant access to their cash from thousands of ABMs. From this starting point grew Interac Debit and Interac e-Transfer, forever changing the way Canadians handled their day-to-day transactions.
Very recently, Interac has reorganized its corporate structure in a way that will generate additional funding for innovation. And, Interac is more committed than ever to the development of new technologies to bring better, more modern solutions to market.
Among those new solutions, work is underway to bring a new digital identity model forward for Canadians. With the movement toward digitization of commerce in all forms, this has the potential to be as much of a game-changer as the creation of the Interac network itself in 1984.
This latest path of innovation reflects Interac’s experience developing and strengthening the identity and authentication requirements of its payments system over many years. At a time when business and policymakers are evaluating the next horizons in technology for the financial sector, the latest advances have opened up an important opportunity for a much wider application of our knowledge and expertise in this area.
While it might not seem so at first glance, payments systems and identification are a natural fit in a digital age. Because security is the cornerstone of a trusted payments architecture, you can replace “making payments” with activities like “signing documents” or “registering for government services.” The basic requirement of secure yet convenient digital identification and authentication remains the same.
By expanding and improving on current collaborative standards for digital identity, we can build a secure, reliable and privacy-enhancing digital identity and authentication ecosystem for all Canadians. This would be an important advancement for individuals, governments, businesses and any organization where there is a reliance on trusted relationships.
With innovative technology, security in the digital identification system will be enforced through data abstraction, replacing each person’s private identifiers (like a driver’s licence number) with unique public identifiers that prove their identity without revealing any information about the foundational documents they possess.
Secure and convenient, when widely adopted it would allow individuals to move beyond the patchwork quilt of paper-based and scattered on-line personal verifications that proliferate for Canadians today. The verification of individuals’ identities would be simplified, while at the same time offering seamless and consistent access to the many services, transactions and agreements in our lives that currently require government-issued physical identification.
A long time ago, payments were constrained by a similar challenge—the need to physically deliver cash or a cheque. We have come a long way since then. The reliance on physical documents and ID cards undermines the digital economy’s promise of efficient, convenient and secure transactions that can be conducted at any time through any channel.
Wherever there is a requirement for physical ID to be presented and verified today, a digital identification solution can help. It would make both the large and smaller transactions in our lives easier, more secure and more convenient—from making a real estate purchase or obtaining a mortgage, to renewing a passport or applying for government services.
Organizations would no longer have to choose between trust or convenience, or invent their own ways of identifying and verifying their customers. Individuals would not have to create new identifiers out of thin air for every new service they engage with. With the right national solution, the same methods could apply across these relationships, to everything and everyone Canadians do business with, across both private and public sectors.
A modern digital ID system would have at its core advanced technical elements that would also eliminate some of the security shortcomings we face today. Insecure methods of identification open the door to both identity theft—the incidence of which has been growing at an average of 33 per cent a year over the past three years— and identity fraud, which is now regularly costing Canadian businesses an estimated $200 million-plus per year, according to the Canadian Anti-Fraud Centre.
Interac is one of this country’s most established innovators. In 2016, it was named Canada’s most innovative organization by ACT Canada, an association of leading players from all sectors of the secure payments, authentication and identity management business. And this current digital ID initiative is only the latest chapter in a long history of innovation through which Interac has been re-thinking and re-inventing the way Canadians conduct commerce, and moving transactions from their traditional roots to the fast changing digital space.
And as work moves ahead, Interac believes its strong track record providing secure and reliable financial innovations will be key to establishing trust at the heart of the identity system. Through the Digital ID & Authentication Council of Canada, Interac is already helping to build a framework of agreed standards for business and governments under the Pan-Canadian Trust Framework, which has been set up to pioneer innovative and modernized digital service delivery.
The potential for improvements in government operations is extensive. Governments at all levels could benefit greatly from strengthening and simplifying processes related to issuing passports, driver’s licences, health cards, social insurance cards, licenses and permits, and the like.
The year 2018 can truly be one of the government’s much-touted #CdnInnovation. We hope those same decision-makers will take a moment to look at the potential of truly innovative leaps forward in identity, and the many opportunities they can offer. Additional information is available in our recently published white paper: “Digital Identity: Unlocking the full potential of Canada’s digital economy.”
Kirkland Morris is vice-president, enterprise strategy, at Interac.
The Hill Times