The Top Reasons Why Digital Identity Solutions Are Vital to Business and Government

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Both businesses and governments are investing in developing Digital identity solutions that provide more effective and secure authentication than traditional password-based methods. Digital identity is often used interchangeably with single sign-on (SSO) and federated identity management, but they are different concepts. A digital identity may be decentralized or centralized, depending on whether there is one authoritative source for verifying a single set of credentials or whether a series of separate identity providers verify them.

The top reasons for investing in digital identity solutions include:


  1. Better protection against data breaches.


Data breaches are becoming the norm rather than the exception, with one notable hack after another being reported in the news. Unfortunately, with no central authority to hold accountable for compromised data, there is no way to prevent future breaches except to increase security everywhere. Implementing a modern identity solution that can recognize users across applications and locations offers an effective long-term solution that makes it harder for hackers to break into systems.


  1. Compliance with privacy regulations.


In the age of data breaches and identity theft, businesses are being held more accountable than ever before for protecting their customers’ personal information. This is especially true in the European Union, where General Data Protection Regulation (GDPR) compliance has just become mandatory.


  1. Improved customer service and protection against fraud.


Businesses want to provide their customers with a personalized experience, but they can’t effectively manage individual identities and attributes without identity solutions. In addition, implementing an identity solution makes it easier for the business to verify the customer’s identity and offers better customer support by giving them more context about each transaction. It also helps prevent fraud and mitigate the impact of data breaches since sensitive customer data is no longer stored in a centralized database.


  1. Lower cost and improved efficiency for business operations and government services.


With digital identities in place, businesses and governments can automate processes and cross-reference user data in one system, rather than requiring each division to manage its own separate authentication infrastructure. This reduces overhead and improves the customer experience by shortening sign-on times and simplifying access to multiple services.


  1. The ability to offer next-generation solutions such as real-time authorization and two-factor authentication (2FA).


One of the most significant advantages of using digital identity solutions is that they are flexible enough to offer services beyond authentication, such as real-time authorization. This allows users one-click access to goods and services at the moment, rather than having to wait for approval or inputting additional information. Digital identities also make it possible to use 2FA to provide an extra layer of security to business and government systems.


Although digital identity solutions can offer benefits throughout the organization, they are vital for companies that handle sensitive customer data or work with government agencies. By investing in a modern identity solution, businesses can improve customer experience and increase security at the same time.


The future is now, and digital identities are coming. If you aren’t already considering identity as a critical element of your digital transformation strategy, it’s time to start now. As time moves forward, identity will become even more critical, potentially influencing everything from individual access to governmental mobility.

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