MyIdentity and Improving Identity Verification
Department for Digital, Culture, Media and Sport (DCMS) and the Digital Identity & Attributes Trust Framework (DIATF)
The Government wants to improve how digital identity is done and demonstrate what a ‘good’ digital identity should look like. As such, the DCMS has made a number of commitments to create a framework for what a good digital identity should look like. They will establish a Governance function to own these rules and make sure that they are followed and develop proposals to ‘remove legislative and regulatory blockers’ for the use of secure identities, whilst ensuring the protection of citizens.
Underneath the DIATF are a number of identity schemes. Each aligned to the DCMS Framework and working to ensure interoperability, as each scheme will have their own nuances to meet the specific needs of its sector.
Etive have been working on the design and development of a scheme for the home buying and selling process since 2018, followed by two rounds of public funding, first from Scottish Enterprise and then Innovate UK.
Is there a problem with identity in the home buying and selling process?
The home buying and selling process is a long transaction built on trust between relying parties - estate agents, conveyancers, brokers and lenders. Each is regulated differently and works to often competing standards and consequently each is not allowed to trust and rely on the identity verification (IDV) carried out by the other.
This has resulted in consumers having to prove their identity up to 5 times through the process, often using different information at different times. This causes great frustration, friction and cost for consumers, as well as relying parties. As one consumer responded, ‘ID checks are currently a joke, I have provided 12 different forms of ID and problems with them all’.
We should also not forget that due to events since 2020, with less face-to-face interactions, there is a greater reliance on digital IDV methods and property and mortgage fraud continues to rise.
MyIdentity Trust Scheme & Regulations
The solution is the development of a trust scheme enabling a consumer to get the IDV done once, which they own, and can share to all relying parties.
The MyIdentity scheme is based on the principles of the DCMS Framework and the Good Practice Guide 45 (GPG45; How to prove and verify someone’s identity). To ensure compliance with Anti-Money Laundering (AML) and compliance for firms, AML regulations were updated in 2019 enabling firms to use an IDV carried out by a certified third party so long as ‘…it is accredited or certified to offer the identity verification service through a governmental or industry process that involved meeting minimum published standards’.
These third parties are identity service providers (IDSPs) and since January 2022 approximately 45 organisations are going the DCMS certification process. Liability has also shifted onto these IDSPs.
Financial Services and MyIdentity
The MyIdentity scheme is participating in the FCA’s regulatory sandbox, enabling firms to test innovative offerings in a live environment and provides FCA regulated firms with the protections that they need to embrace the Government and MyIdentity standards.
MyIdentity is also working through UK Finance to work to get MyIdentity into a position that lenders will accept a MyIdentity IDV and how financial organisations can re-use these IDV’s for all financial services, a re-usable identity, a DCMS objective.
Further work is being done to help remove the blockers for other cohorts involved in the sales process such as conveyancers and brokers who rely on the ‘lender’s handbooks’ from both UK Finance and the Building Societies Association (BSA).
The Beta stage of the project is testing processes and technology looking at improved IDV standards, regulation of providers and greater protections for consumers and the industry.
If we look at Norway, for example, when they developed their trust network, BankID, fraud reduced from 2% of financial transactions to 0.00042% and mortgage lending times reduced to 1 day.
Great work is being done by the industry, coming together, to help improve the process of home buying and selling, also a policy objective of The Department for Levelling Up, Housing and Communities (DLUCH).