Welcome. I'm here to talk about the future of digital identity and how it impacts the business and the digital business of today. And I'm here with Marie Austenaa of Visa. Welcome, Marie.
Thank you. Nice to be here.
So maybe we can start with you explaining a bit your role you have in this world of identity and at Visa.
Yeah, sure. So I've worked in digital identity since about 2014. It's coming up to ten years now. At Visa, I've been for the last few years where I'm leading on digital identity for Europe. Really trying to figure out how do we adapt payments and everything that's happening within digital identity, particularly in Europe now. Very much in eIDAS, what’s the impact that’s going to have on payments? How do we benefit from it from a payment perspective as well, to make payments more secure and more convenient? And, yeah, to bring more assurances and benefits, both, whether it is the banks issuing the cards so whether it’s to mergers and acquirers. So how can we enrich the payment ecosystem with verified identities?
Okay. And so when you look at all the evolution, we have already started, talking about eIDAS, which goes into decentralized identity. What do you feel is the next big thing, or the big evolutionary thing we are facing?
When it comes to the future of identity... So when I... so I come from a market which is pretty mature. We have our digital identities is used by 80% of the population. And the first thing that I find super convenient, and it kind of gives me a sense of relief, is when I can see that I can use my bank issued bank identity, my bank ID, just for basic things like login, or even to open a bank account or to subscribe to a service or even to authenticate a payment transaction. So it's that predictability of a trusted and convenient user experience. So that's what I'm looking for as well. As we're now entering into the new world with a digital identity wallet. How can we use that? How can we use Passkeys for payment authentication as an example, to open an account, to instantly get the card to really change the way that we’re interacting, around payments.
But so from your perspective, it's probably a bit more evolutionary in that sense than revolutionary.
That's a good that is a really good point. So from an existing mature market, for sure, there's going to be a tweak in technology. You know, this redeployment of the of the infrastructure. But from a consumer perspective it's going to be an enhancement. It's not a complete revolution. I also see in other markets with less mature identity systems that there are solutions today. They are not maybe not quite as convenient, but they are solutions. You're not going to go back and having to walk into a branch to open a bank account or to get the card issued, you may just no longer have to scan your passport. So it's going to be an evolution is going to build on that kind of understanding that the consumers have about the digital and the trust. But it's going to get better and more convenient.
And probably more reusable. I think this is also one of the advantages we potentially face this with the world of wallets. If you do it right, I think there are a lot of things to be discussed, but at the end of the day, it means we can work from the same wallet for payment aspects. We can use it for governmental interactions, can use it for e-commerce, we can use it for whatever else. I think we are still, from my perspective, still just scratching the surface of the potential use cases.
Yeah. Totally. Totally. So at one hand, we will go from, you know, that passport scanning exercise with your face matching the photo of these things to a reusable identity that, you know, you can trust and you just kind of release the necessary identity data. But getting to the next stage in terms of the wallet, that might be where we hopefully should see the revolution, where that wallet can hold credentials about you, that can be verified, that can be trusted, and that can then open up so many new use cases. So we have an, there's an interesting small company in the Nordics that does lending to SMBs. And in order to be able to get into the space of lending or maybe €10,000, €30,000, small loans, that just bridges them for a few months, right? You need to have a very efficient system in order to understand the identity of the company of this, the person who can sign for it, can they pay back the loan that they're getting? What is what is the amount of income and outcomes they have and so forth. But that is possible. Imagine doing that at scale. That is the current things happening in the digital identity market.
That's one of the things I have been touching today in my keynote about. I believe the real huge thing is really how we can improve business processes that currently have a lot of, of regulatory compliance effort in a relative high complexity in the process, and to do things like lending to small companies with relatively even small amounts, we need to be efficient so that it really is economic for the organizations. And that's also where I believe we have an incredible potential of what is happening next, that we really can go into a business process optimization. When you look at a cost of AML processes, the KYC processes for large banks, we are talking about very large sums here. And this is I think where then in this respect, it really becomes revolutionary because it changes the way we can do a lot of things from complex, frequently manual processes. I remember when I go to my bank and sometimes when you come to the [...] every now and then they say, oh, we have this package to sign. And these things I think we can do much better in the future.
Yeah, for sure, for sure. And also the combination of different kinds of credentials and then you have a smooth experience. So the other example I keep giving is car rental. So I can, you know, because I come in this country from this mature identity schemes, right. I have an app that I onboarded to using my bank ID. I added my card. I then gave them permission to check that I had a driving license. Now I have this app and there's a rental car two minutes to walk away from where I live. It is not a rental agency. I pick up the car with my phone and I drive away. And this is, you know, what's it called, transporter cars, so I can do it when I take moving rubbish away or making small moves or something. So convenient. But you can't do it unless you can digitize the whole process. And add the combinations of all credentials that they can trust, right?
And it's by the way funny. I just recently had for a reason, so our car was in a garage and I needed a car, so I checked the car sharing providers in my region and basically there are three and two which are more across Germany and, and one is, which is really more local to Stuttgart, where I live. At the end of the day I went with one of the other two because they had a fully digital onboarding process, while for the other, I would still have had to walk into an office with my driver's license, etc., and it took too long because I needed the car then, now, not in whenever, and it was just inconvenient. The thing which I found a bit still disturbing was, I applied for two car sharing providers and I had to do two onboarding processes. In the age of the wallet, it will be, I just use my wallet and I do it once for the wallet and then I'm done.
Exactly.
Yeah. And I think this is really where we are heading. And I like your thoughts about that. So do you feel we are already ready to do that, or is it still that we are at the inflection point, we are getting close to the inflection point. Where do we stand?
I've always been quite... To be honest, I've been always been skeptical to verifiable credentials, at creating that ecosystem around decentralized identities, self-sovereign identity. I think now what has changed it, is actually the braveness of the European Commission, but making a stance and saying eIDAS, based on SSI, here is the technical specifications. We know it is not perfect at all and you know, as part of our headaches, but it is great, is drawing a line in the sand and saying this is it. And now we can work on solving the problems as opposed to trying to make big choices about what to do, right? And I see that change in solving practical problems. You know, we are working on a daily basis to apply this to payment. Imagine, you know, applying OpenID Connect for verifiable credentials, let alone VP for dynamic linking. It can, you know, it gives people a headache. But I see concretely how step by step we’re making progress however, which is why I don't think it's ready today. But maybe not tomorrow. But give it a few more, you know, months or even, you know, we have a few years, right? But I do see that there's some great progress being made. There are industries and ecosystem coming together to solve these problems, but there are fundamental challenges on, how are you going to operationalize this, how do we get to the five nines plus that we need to do anything as sensitive as payment, let alone identity, right? How do you have a business model that ensures that the issues are being, rewarded for the value that the verifiers, the merchants are benefiting from, right? So there's still some of these fundamental challenges that needs to be worked through. But there's so many people working on it that. So I'm hopeful.
Yeah. I'm also very positive right now. We have been talking about this theme at the European Identity Conference for more than a decade now. so we really see a major progress here. So Marie, thank you very much for taking the time, to talk with me about this and for sharing your thoughts. And thank you to everyone for listening to us.
Thank you for having me.
