One identity hub for Europe’s banks


Gunnar Nordseth, CEO, Signicat

Over the past 10 years, the Norwegian digital identity solutions pioneer, Signicat, has built and expanded the first cross-European Identity Hub for Europe’s 4,000 banks. Around 200 banks have already joined the hub.

Article from the official Money20/20 magazine MoneyMag by Michael Juul Rugaard, Norfico

One of the common characteristics of regulatory initiatives is how identity  is  increasingly  taking centre stage. This is unquestionably a reflection of a larger trend as expressed in David Birch’s book Identity is the New Money and in an interview in 2014 where he says, “Looking at the situation now,  you can’t help thinking that maybe some kind  of  Single  European  Identity Area would have made more sense that a Single Euro Payments Area.”

To enable banks and other players further to realise their digital ambitions by leveraging the existing eID solutions or by delivering their own, Signicat has built a dedicated identity on demand platform. With this in place, Signicat has established itself as Europe’s leading ‘Digital Identity Service Provider’ or simply ‘DISP’. One of the features of the DISP platform that will be of critical importance in the light of PSD2 is its ability to enable banks to handle the new requirements for Strong Customer Authentication (SCA).

PSD2 leading the way

Looking specifically at PSD2, one of the main themes of the comprehensive EU directive is authentication, which is all about the ability to verify a certain digital identity. Article 97 of PSD2 imposes Strong Customer Authentication (SCA), which means at least two-factor authentication, in all online-transactions  going forward.

Implications for the banks

These new SCA requirements are expected to have important implications for European banks for two reasons:

Firstly, the banks are by default liable and responsible for the handling of SCA in accordance with PSD2-related transactions made by Third Party Providers (TPPs) – whether PISPs or AISPs. Secondly, the number of SCA transactions is expected to increase massively as a direct consequence of PSD2 as soon as the directive is fully implemented and the TPPs have had some time to promote their new services (AIS and PIS) across Europe.

Gunnar Nordseth, CEO of Signicat, is prepared to help the European banks handle the PSD2 Strong Customer Authentication (SCA) requirements by providing ‘Authentication as a Service’ through the company’s cross-European DISP. Gunnar Nordseth explains:

“SCA is certainly an issue that European banks need to be prepared for – and the sooner, the better. The largest and most innovative European banks are already preparing, but this is just the tip of the iceberg and the vast majority of Europe’s banks still need to plan for the future handling of SCA. The problem is that they must comply and they have quite limited time to do so.”

All banks in Europe share this same challenge, which is to handle SCA in the most efficient, flexible, user-friendly and cost effective way. Yet SCA is not one of their core  competencies.

Authentication as a Service

This scenario obviously creates an opportunity for a specialist to step in and offer a pan- European ‘Authentication as a Service’ solution, which will effectively ease the banks’ SCA pains and enable them to focus on their core businesses.

“This is exactly what we are doing at Signicat. Based on ten years of experience working  with two-factor national eID schemes, we have developed our DISP platform as an online identity hub. This DISP platform offers Identity On Demand services for customers, regardless of geography or eID,” Gunnar Nordseth says and continues:

“Strong customer authentication is a fundamental part of the DISP platform, which means Signicat is best placed to scale its services to banks all over Europe in need of SCA assistance.

Today, more than 200 European banks and financial institutions, as well as insurance companies and government agencies, are connected to Signicat’s DISP platform. As well as the responsibility of authenticating users, many customers have mandated Signicat to provide electronic signing, identity proofing and document preservation.

Basic DISP services to banks

Under PSD2, Europe’s 4,000 banks will be required to offer SCA services to all authorised Third Party Providers (TPPs), which will require the banks themselves, or their current platform or service providers, to implement and maintain these SCA services. Alternatively, they can choose to outsource the SCA task to Signicat, making use of Signicat’s DISP platform and ‘Authentication as a Service’ solution, thereby freeing up time and resources to focus on their core business. The DISP platform’s main PSD2 related features are its services to identify and authenticate individual customers and to allow siloed information to be accessed by other banking areas. The DISP also opens the possibility for banks to be able to offer identity services to third parties – e.g. to AISPs and PISPs.

Beyond PSD2 – partnering with Rabobank “A common theme for our customers is the need to support all available eIDs in the markets in which they operate, and they do not want to invest heavily in order to implement this,” says Gunnar Nordseth.

Among financial institutions already using Signicat to support their eIDs are Banco Santander, BMW Financial Services and large Nordic region insurance and finance companies like SEB, If Insurance and Tryg.

“The fact that Signicat operates its DISP platform means that our customers can select which eIDs they want to activate and Signicat sets up a service providing access to the eIDs,” says Gunnar Nordseth.

Recently, leading Dutch bank Rabobank announced that it had joined forces with Signicat to launch a Digital Identity Service Provider (DISP) for businesses in the Dutch market. Rabobank wants to utilise the DISP to offer a range of online login, identity, signature and archiving solutions under its own eBusiness banner.

Rabobank initially intends to focus on five customer groups: energy, telecom and insurance companies, healthcare institutions and financial services providers. The idea is that Rabo eBusiness services will make it easy for businesses to enable functions such as onboarding new customers, digitally signing contracts and offering a dashboard for invoices or expense claims.

“What we are doing together with Rabobank is a good example of how Signicat’s Digital Identity Hub can assist not only with PSD2- related SCA compliance services but at the same time offer a bank a uniform way of handling identities across all platforms and channels,” Gunnar Nordseth concludes.

Link to the official Money20/20 magazine here

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