Can you prove who you are?


Date: 30 January 2012

Man holding passportDespite all the exciting online companies out there, we’ve got a problem with online business: currently, it’s hard for companies to be confident they know who their online customers are.

When you sign up for a credit agreement in a shop, you can show a proof of identity like your passport. This is called the primary identity check. But online, that’s impossible. The best most online businesses can do is to consult another database, like the electoral roll or a credit reference agency.

Although great for validating information about you, these do not prove you are who you say you are in the same way that photo ID does.

Primary identity checks and your business

For online businesses to perform to their full potential, we need better primary identity checks online. My company, miiCard, is finding ways to do this. And I believe better ID checks can benefit smaller online businesses in several ways:

  • Fairer competition with big companies. Smaller businesses often don’t have the real-world premises or workforce to process paper documents. Just look at signing a contract or agreement: enabling true digital signatures gives you an identity you can prove, all without having to handle any paper or meet in person. It opens up all sorts of possibilities in areas like employment contracts, real estate, legal and financial services.
  • It’s easier to build real trust. Trust is a two-way street, but it starts with the business, not the individual customer. It’s easier for larger businesses with well-known names to establish trust online. If you don’t have a recognised brand or big budget to invest in marketing, it is hard to provide the trust people look for when shopping online. Having a credit card logo on your site isn’t enough. Fraudsters are sophisticated and so small businesses need to do more to give customers confidence.
  • Better risk management. Again, with higher value, riskier or regulated services you need to know who you are selling to. Credit card fraud and other scams can cost your business. Getting assurance up front that you are selling to a specific person can easily prevent these and have a real impact on your bottom line. Just think what a difference it would make if you could meet every customer personally and shake them by the hand. Better identity checks can create the same sort of confidence.
  • Going international is less intimidating. The internet is a global marketplace which can open new avenues for small businesses. A global identity service lets you do more in countries where you don’t have a physical presence. It’s not just about selling - it can be about outsourcing too.

By building trust through better online identity management, businesses can benefit from increased conversion rates, reduced costs, higher-value sales, and additional fraud protection. Only then will the full potential and convenience of online trade be fully realised.

James Varga is CEO of miiCard.

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