Monday, May 27, 2024

    Digital identity revenue for MNOs to exceed $8bn by 2025, as verification comes to the fore

    A new study from Juniper Research has found that mobile network operator revenue from digital identity will reach $8.1 billion in 2025, up from just $1.3 billion in 2020.

    The research found that, as the identity space evolves, MNOs will play an increasingly important role in providing verification of digital identity and universal login based on subscriber identity. This is particularly important in emerging markets where banking penetration is lower.

    The report identified that these capabilities would form a critical part of emerging identity networks, with MNOs able to play the role of a guarantor of identity. The research recommends that vendors employ robust KYC (Know Your Customer) checks to ensure the security of identities.

    Verification critical to securing identity networks

    The new research, Digital Identity: Technology Evolution, Regulatory Landscape & Forecasts 2020-2025, found that verification needs further adoption to secure digital identity. The report recommends leveraging the large availability of smartphones featuring biometric capabilities, projected at more than 5.2 billion in 2025, to ensure a secure digital identity environment by authorising identity use within digital onboarding. This initial secure verification will be critical in making identity available in high-trust environments, such as financial services.

    Research co-author Nick Maynard explains: “Bringing biometric verification within digital identity requires robust orchestration capabilities and extensive partnerships, meaning that digital identity vendors must focus on building out their ecosystems.”

    API economy has big identity implications

    The research also found that the rise of open APIs is stimulating the digital identity market, by providing interconnected data and allowing access to different systems. As such, identity vendors have more data than ever, but this comes with the challenges of ensuring that all the data is orchestrated correctly and that the transaction is correctly authorised or declined.

    The research recommends AI as critical to this orchestration, but highlighted explainability around decisions as essential for supporting greater digital identity use, particularly in highly regulated markets, such as financial services.

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