Apple Wallet Enters the Digital Identity Space

Apple unveiled another surprise in June, 2021

Apple announced a new digital identity card to be housed within the Apple Wallet. Apple revealed the new Apple digital identity at the recent online Worldwide Apple Developer’s Conference. The company’s move into portable digital ID clearly shows this is an ongoing problem and frustration for consumers.

Users create the digital ID card when they upload a driver’s license or state ID to their Apple Wallet. The ID is encrypted and stored within Apple’s Secure Element. This step maintains the privacy of users’ digital information.

The Apple news release predicted consumers would use the new ID at airport security checkpoints. And in an expansion of the digital car key feature Apple introduced last year, the new digital ID for the Apple Wallet can store digital house keys, office keys, and hotel keys.

Apple isn’t the first company to enter the digital ID space. But they may well be the entry that finally pushes the federal government to establish standards and protocols for digital ID.

This step may encourage more consumers to use Apple Pay

Observers predicted this as soon as Apple announced the Apple Wallet digital ID. They reasoned the digital ID enables Apple to tap into more opportunities for consumers to use contact-less payment. They also projected that iPhone users will now engage with their devices even more.

Expansion into Europe may force Apple to compete with the European Union (EU)

There’s an effort in place to develop an EU government-sponsored portable digital identity. Consumers may prefer to store their personal digital information in a government-backed platform rather than a commercial one. This is likely to make it harder for the Apple Wallet ID to take off in Europe.

They may face similar difficulties in the US if the federal government begins to develop a standard portable digital ID. Although in the US, Apple’s strong established consumer base would help it compete against a federal effort.

Not everyone is thrilled with Apple’s move

Some observers point to the increased overall risk of giving Apple so many pieces of one’s digital identity information. Cyber-security expert Dave Derigiotis notes that the presence of the Apple digital ID is added incentive for hackers to get into your device.

“I think you are taking a significant amount of risk putting so many privacy eggs in one basket,” he said. He pointed out there have been dozens of highly publicized incidents where hackers gained access to sensitive information or photos. It makes one wonder what further trouble could ensue when a single hacked access point could expose the private digital information of millions of people.

Others have questioned whether it’s a good idea to have your state-issued ID carried in a proprietary Apple product.

The Apple Wallet digital identity may create a federated ID situation like other providers

Identity federation (federated ID) is the process by which a third party handles the responsibility for personal online authentication. Federated ID third parties tend to be online or social media giants like Facebook, Google, or Amazon. Apple fits right in with this group.

The main federated ID security concern revolves around who owns the data. Typically, the identity provider (IDP) owns the personal data of people who use their system.

This means how the IDP processes, stores, protects, and shares this information directly impacts consumer security and privacy. Plus, the IDP database is now an attractive target for hackers.

This is really what’s at risk when digital identification rights have been given to a third party. It’s not in the best interests of your members when a federated ID provider like Apple owns their private personal information. It’s much better when you offer them MemberPass, the in-house option.

MemberPass is an excellent digital ID alternative for CU members

For starters, members retain control and ownership of their personal digital information. This is the way it should be. It’s a secure encrypted digital connection between you and the members. No third party comes between you and the member.

Plus, MemberPass insulates members against identity theft or imposter fraud. With MemberPass in place, the stress and hardship caused by financial fraud are virtually unheard of.

If you haven’t already added MemberPass to your credit union, we’d be happy to arrange a personal demo

Seeing is believing, and you can email us to set one up. You can also register to attend a MemberPass webinar or visit us online at www.memberpass.com to find out more.

The convenience, security and fraud-fighting power of MemberPass should be part of every member’s financial wellness profile. The sooner you adopt the program, the sooner your members will enjoy the direct benefits!

Bonifii, a credit union service organization, offers MemberPass, a simple, secure and convenient member identity verification method. MemberPass is a digital passport that provides convenient access to members’ financial accounts while they keep control of their private personal information.  We leverage touchless technology to protect you and your members. Visit  www.memberpass.com or email sales@memberpass.com.