Britain’s high street banks are making a push to be the repositories of more than just money: they want to be the safe place where customers store their digital identities too.
On Tuesday, a new report revealed how Lloyds Banking Group – a quarter-owned by the UK government – has been working with the prime minister’s office to test whether banks could vouch for their customers’ identities to other organisations via a simple smartphone app. “Their ability to earn money off simply moving money around is collapsing so they need to start working on value-added services,” says David Birch, head of the payments group at industry body techUK, and director of electronic transaction consultancy Consult Hyperion. Technology consultants suggest that banks – which are already subject to stringent regulations over checking customers’ credentials – are an obvious choice for providing “identity assurance” services. By having a bank confirm a potential customer’s identity, companies and public sector bodies can dispense with their own time-consuming checks, consultants claim. In this way, the bank’s role becomes similar to that of an airport security guard who can allow pre-screened passengers skip the queue for the metal detectors.