GDPR: Modern Wealth It Is In Your Digital DNA
Hands up if you don’t really know what GDPR is… don’t worry, you’re not alone in fact, 6 in 10 people have never heard of it.
And why should the average consumer know about the General Data Protection Regulation (GDPR)? The regulation itself, which will become enforceable in May 2018, is designed to stop businesses using our data without our knowledge or consent. And that consent means complete transparency on how our data is being used. This sounds like a very reasonable expectation for consumers to have, which of course begs the question; why hasn’t this been the standard up until now?
Identity data is digital gold
The answer; because identity data is the wealth of the future. And consumers are their own worst enemy when it comes to protecting their wealth; 17% of us have used an unprotected PC or internet link to shop online.
It’s not just about fraudsters ‘hacking’ the checkout process, many of us are actively leaving a trail of personal data breadcrumbs for those seeking to build a fuller picture. This has led to a spike in ‘interception fraud,’ where criminals glean enough genuine information from our unprotected digital footprint to con us into misdirecting genuine payments. We sign away our privacy and data rights without thinking of the consequences, or reading the small print. One free wifi provider highlighted this, by having users agree to clean the toilets in their fine print.
When you think about it, why does a merchant need to know your gender for you to purchase an item online? They wouldn’t record that data if you purchased in store. The Big Data buzz has resulted in many companies manically collecting data, but without a clear process for securely storing and managing that data, or for ensuring that the consumer is aware of what data is being collected and why.
How to regain control of your digital identity
Consumers are beginning to wake up to the value of their digital identity and the associated data, and the need to take back the power in how that data is leveraged and controlled. We can think of our identity data like our digital DNA; it’s our unique identifier in an increasingly digital ecosystem. And you wouldn’t give away your DNA sequence without some serious thought. As part of the ‘food chain’ in the digital ecosystem, we need to understand that if we don't own our data, someone else will gobble it up.
Who to trust with your digital DNA
Ask yourself, where do you keep your current wealth? Probably a bank. Your money is digital, like your new identity, so why not entrust it to the same institution you trust to protect your money.
Banks are highly regulated, ensuring they will be held to the GDPR standards. They can also lean on their extensive experience and resources to help protect your data.
The driver for banks is to figure out how to provide data-management services in a way that brings value to their customers and themselves. This could center on new open API-enabled information flows, where banks provide tokenized identity data out to third parties for authentication and authorization, in such a way that the actual data is protected. Many banks are making moves towards this already, with some looking to augment traditional payment fraud prevention data (such as transaction limits) with Artificial Intelligence (AI) to predict upcoming fraudulent events using non-financial data, such as an unexpected change of email address.
It’s clear that your actual digital identity and the liquidity of identity data that surrounds it are only going to become more valuable, and as a consumer you need to protect that data both at the source and as it flows out into the ecosystem.
As consumers, we need to become more informed digital citizens, but if banks want to be the ones to provide value-added data services, then they also need to support the education piece.
Find out more about how payments players can support their customers to protect and leverage their digital identities and data in the New Payments Ecosystem.
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