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The pros and cons of digital identities

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Thirty years ago, I presented at a conference with the theme being the end of cash. Thirty years later we are all gradually going cashless.

Twenty-five years ago, I presented at a conference, with the view that bank branches weren’t needed. Twenty-five years later, most bank branches are going, going, gone.

Twenty years ago, I presented at a conference with the theme focused around the death of cards. Twenty years later, we have cards, but they’re not really needed and MasterCard should be called MasterChip.

I could go on, but there was one specific discussion I presented which has stayed with me to this day: why do I need a document to prove my identity? I could just as easily have a chip inside. The whole point is that, if you have a digital identity, you could move around without borders and checks. You just arrive and are recognised.

That all sounds good and the latest news is that the UK will soon start testing facial recognition at borders. So yes, you just arrive and are recognised. But how would this work? For residents it’s easy. The Netherlands have had facial recognition for Dutch citizens for years. But for entrants from other countries? Well, it’s been used for a while. Australia offers entrance using facial recognition.

“I had to apply for an electronic travel authorisation in advance and used my smartphone to read the chip in my passport. That sent the image of me in the chip to the Australian authorities. When I arrived in Australia, I didn’t even have to get my passport out of my bag. It is a really interesting concept”, says Phil Douglas, the director-general of Border Force, UK.

The thing is that Mr. Douglas had to scan his passport. Can we get rid of passports?

Right now, I have to present documents at all airports. In the UK, as a UK citizen, I have to present my passport and wait for a facial scan that takes a minute or more, before entering the country. In Poland, as a UK citizen, I have to present my passport and a resident’s card to a human who checks it on a database before entry. In some countries, I need to get a visa before entry, which takes ages and costs.

Could we ever live in a world where our body is our ID?

Well yes. Digitalisation of identities is developing rapidly and, if we could identify ourselves just by smiling, is that a good thing? Well, yes, it’s a good and a bad thing. The good thing is that you can move around the world without identity documents. The bad thing is that you can move around the world and be recognised.

This may not trouble some people, but it is concerning that your every movement could be tracked and traced. Wherever you are and wherever you go, governments will know what you are doing. A bit like Liam Neeson in Taken, we can go a step further:

“I know who you are. I know where you are. And I know what you’re doing.”

Oh! Yes folks, it’s not far away. In fact, it’s already in place in some countries like China. I remember arriving in China a few years ago and had left my iPhone next to the entry scanner (they use facial recognition). As I walked back to get it, thinking it was bound to be lost, I spoke with the border authroities and was shocked to see every person entering the terminal was being scanned. Everyone.

The good news is that included me and they found my iPhone and gave it back to me. The bad news is that every single person entering or leaving China is being tracked and traced. Or is that bad news? Surely the only people who don’t want to be tracked and traced are the bad actors?

Either way, you can forget some of these things as you’re being tracked and traced all the time whether you like it or not:

The British Security Industry Authority estimates that there are now somewhere between four and six million CCTV cameras in the UK. That means between 16 and 24 cameras for every square kilometre. In comparison: China uses more CCTV cameras than any other country, with an estimated 200 million systems.

As we digitalise identities, we offer access to all authorities to track and trace our every movement.


Chris Skinner Author Avatar

Chris M Skinner

Chris Skinner is best known as an independent commentator on the financial markets through his blog,, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal's Financial News. To learn more click here...

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