PaymentsJournal
No Result
View All Result
SIGN UP
  • Commercial
  • Credit
  • Debit
  • Digital Assets & Crypto
  • Digital Banking
  • Emerging Payments
  • Fraud & Security
  • Merchant
  • Prepaid
PaymentsJournal
  • Commercial
  • Credit
  • Debit
  • Digital Assets & Crypto
  • Digital Banking
  • Emerging Payments
  • Fraud & Security
  • Merchant
  • Prepaid
No Result
View All Result
PaymentsJournal
No Result
View All Result

The Federal Government’s Hard Case for the Identity Ecosystem

By George Peabody
January 30, 2011
in Mercator Insights
0
0
SHARES
0
VIEWS
Share on FacebookShare on TwitterShare on LinkedIn
American Express Introduces Enhanced Business Travel Account to Help Companies Manage the Reality of Business Travel - PaymentsJournal

Background from bank plastic cards. Figures on the card. Small depth of sharpness. Indoors. Horizontal format. Gray, green, yellow. Color. Photo.

The federal government’s idea for simplifyingour online lives, especially with respect to e-commerce, is gettingsome traction in the popular online press (see link below). Theattraction of a national single sign on scheme, operated by atrusted third party, is an intuitively compelling notion. I mean,isn’t it obvious? Just move the welter of passwords that plague ustoday to a service that trusts me and vouches for me to the onlinesites I visit. What could be more logical?
Unfortunately, that’s about as far as it goes. Beneath the firstlayer of simplicity lies a morass of complication and not justtechnical details. Contractual and liability concerns abound.Building online trust is hard. While the simplest use case ofanonymous access to a site or even subscriber access to a news siteseems simple enough (and it isn’t), e-commerce transactions requirea far higher level of surety and security.

Identity ecosystem proponents argue that consumer demand will drivemerchants to accept this new form of identity verification.Consumer convenience, as it so often does, is predicted tooverwhelm the reticence of merchants and other entities concernedwith online security. That’s a big assumption because these schemeshave to convince a very experienced and highly skeptical audience -the fraud and risk managers of online retailers who are, in fact, amajor target beneficiary of the NSTIC or any other federatedidentity plan. Based on Mercator’s research in collaboration withthe Merchant Risk Council, that will be a tall order (see ourreport Trekking to Find the Holy Grail: E-Commerce Identity andAuthentication).

Even the track record of simplifying assumptions in authenticationis not encouraging. OpenID, a single sign on scheme, has nottranslated into wide adoption. Indeed, for the site operator,OpenID implementation has proven difficult. Recently, 37signals (arespected Web 2.0 SaaS developer) announced it is phasing outOpenID support in favor of a proprietary scheme serving its ownonline properties. When the web cognoscenti turns up its nose at atechnology, that is not a good sign.

Given its ubiquity, some are saying Facebook will become the singlesign-on provider. Based on its track record with privacy controls,that should give everyone pause. Scares me to death.

This blog post is not a defense of the weak user ID and passwordschemes employed today. There are better ways. At Mercator, we areexamining online and mobile authentication schemes. An upcomingreport will look at the potential for smartphone-basedauthentication methods. For higher value use cases, that seems tobe a particularly compelling route.

http://www.businessweek.com/magazine/content/11_06/b4214036537462.htm
To read the Mercator and Merchant Risk Council report onthe NSTIC and Identity Ecosystem notion, here’s the link:http://www.mercatoradvisorygroup.com/images/MRC%20WHITEPAPER.pdf

0
SHARES
0
VIEWS
Share on FacebookShare on TwitterShare on LinkedIn
Tags: DebitMobile PaymentsPrepaid

    Get the Latest News and Insights Delivered Daily

    Subscribe to the PaymentsJournal Newsletter for exclusive insight and data from Javelin Strategy & Research analysts and industry professionals.

    [honeypot phone]

    Must Reads

    stripe ai

    New Approaches to Fighting New-Account Fraud

    November 14, 2025
    credit union data

    The Information Age: How Credit Unions Can Maximize the Impact of Their Data

    November 13, 2025
    embedded lending

    Empowering Merchants with Embedded Lending: How ISVs Can Optimize Revenue This Holiday Season

    November 12, 2025
    visa mastercard settlement

    Visa and Mastercard’s Merchant Settlement Could Imperil Rewards Cards

    November 11, 2025
    merchant ai

    Agentic Commerce Faces Many Hurdles Before It Reaches Maturity

    November 10, 2025
    square ai bitcoin

    The Challenge of Monetizing Value in Digital Banking

    November 7, 2025
    AI artificial intelligence gift cards

    Deck the Holograms: How AI Is Redefining Holiday Magic

    November 6, 2025
    digital wallets student loan repayment

    How Digital Wallets Could be the Answer to the Student Loan Repayment Crisis 

    November 5, 2025

    Linkedin-in X-twitter
    • Commercial
    • Credit
    • Debit
    • Digital Assets & Crypto
    • Digital Banking
    • Commercial
    • Credit
    • Debit
    • Digital Assets & Crypto
    • Digital Banking
    • Emerging Payments
    • Fraud & Security
    • Merchant
    • Prepaid
    • Emerging Payments
    • Fraud & Security
    • Merchant
    • Prepaid
    • About Us
    • Advertise With Us
    • Sign Up for Our Newsletter
    • About Us
    • Advertise With Us
    • Sign Up for Our Newsletter

    ©2024 PaymentsJournal.com |  Terms of Use | Privacy Policy

    • Commercial Payments
    • Credit
    • Debit
    • Digital Assets & Crypto
    • Emerging Payments
    • Fraud & Security
    • Merchant
    • Prepaid
    No Result
    View All Result