What is a Digital Identity & Do You Need One?

What is a Digital Identity & Do You Need One?

We’ve had a whole heap of new phrases and buzzwords thrown at us over the last couple of years. Vaccine passports. NFTs. Metaverses. Digital ID cards. It’s hard to keep up. As our lives rely less on paper and more on screens, we’ve got more technology to get used to.

More recently, you might have heard rumours of Digital ID in Australia. In 2021, the government asked the public for their feedback on proposals to create a “trusted digital identity system”. But what does “digital identity” mean, is it mandatory to create one, and what are the pros and cons at play?

What is a digital identity?

A digital identity is created as a way of streamlining access to a range of government services. In theory, a digital ID will enable citizens to link their data across the likes of Medicare, Centrelink and the ATO without having to identify themselves again and again.

According to the official website, it’s the “digital equivalent of a 100-point ID check at a government shopfront or Post Office”.

This digital ID can be created through MyGov (using an existing identity document, like your passport) and would unlock access to 80 services in total. Beyond governmental sites, though, there are proposals for digital ID to expand to approved local businesses. The idea is that businesses can apply to join the “Trusted Digital Identity Framework”, enabling interaction with customers through techniques such as face biometrics.

Will digital ID in Australia be mandatory?

Although the notion of a digital ID system has been floating around for some time, it seems that recently, the Australian government has placed a bigger push on the tech. In March 2022, Innovation Aus reported that digital ministers had agreed to “actively explore” a national digital identity system, with the federal government already pouring in $450 million to the initiative.

Over 1.7 million Australians and 1.2 million businesses already use Digital Identity - but is it mandatory? At this point, no. The Digital Identity system is based on a principle of choice, so creating and using it is completely optional. The government has also said the system isn’t there to replace traditional ID documents, such as your passport and birth certificate.

The good, the bad and the barriers

Digital ID isn’t just a topic here in Australia. Governments around the world are focusing on digital identity systems, with the intention that they’ll provide a more secure way for members of the public to access online government services. 

The proposed benefits of the system include:

• Making it easier, faster and more convenient for individuals and businesses to access government and private sectors easier
• Safeguarding privacy by only sharing relevant details
• Helping to prevent fraud and identity theft when interacting online
• Supporting Australia’s vision of becoming a leading digital economy by 2030

Digital rights advocacy groups, however, aren’t on board. This integrated linking of personal information goes against standard advice because, as we’ve seen in the past, issues like mass analytics and behaviour profiling can stem from the practice. And we’re not sure whether members of the public will be fully aware of this. 

Of course, there are pitfalls and concerns around any new technology. Can we trust third-party identity providers? How exactly do biometrics work? Will stored personal data become a “honeypot” for cybercriminals? These are all questions on the lips of those against Digital ID, but we predict that as the system becomes more standardised, it will overcome any pitfalls and could bring pretty good time and money savings to Australians.

Sound like something you’re interested in? Find out how to create your digital identity to get started.