Whether you’re applying for a phone contract or taking out a mortgage deal, identification is essential to secure credit from a lender.

I welcomed the government’s recent announcement to extend the use of digital identity in the UK – however, it might have done us all a disservice by ruling out ID cards in both their physical and digital form.

Verifying a customer’s identity can now be done entirely digitally – but what if we could go even further? What if, rather than creating a digital ID which can be carried all the way through each transaction, there was a way to only ever have to verify someone’s identity once?

Digital ID cards could make this possible, and although the government recently ruled out their introduction in the short term, there would be several benefits if a change of mind came to pass.

Progressing past paper

Over recent months, digital ID has become essential for nearly every consumer financial service. The continuing operation of credit in all settings has depended on the online verification of borrowers, their income details, and more.

Though some institutions and firms were already ahead of the curve before the pandemic, Covid-19 forced the industry as a whole to make great, sprinting strides towards a widely accepted process for digital ID verification.

The advantages extend beyond the single greatest disruption to our economy for decades, and into ‘normal’ times too. Digital ID increases efficiency, reduces fraud risk and provides a smoother, more secure application process for every single stakeholder.

There’s just one downside – you have to do it for each application. Digital ID cards would make verification a one stop shop.

Taking the next step

It seems logical that we should finish the job when it comes to eliminating friction points in mortgage applications and push forward for minimal repetition and duplication of work for borrower, broker, and lender alike.

A nationwide implementation of digital ID cards could take us closer to that reality, and the benefits would not only be felt in our industry but in every situation reliant on credit assessments.

At Smartr365, we’ve already made significant strides towards a smooth digital ID verification process.

The platform integrates Digidentity’s digital ID verification service, which also underpins the UK government’s GOV.UK verify service. Brokers using the platform now simply need to request the client to begin the fact find, and from there the end-to-end platform can remotely verify the customer’s identity and carry the details forward through each stage of the entire mortgage journey.

We expect this level of ease and convenience to become more widely spread as the government works to extend the use of digital identity as per its recent commitment, but through the use of ID cards could make ID verification a one-time thing, and help us reach the ultimate goal at a faster pace. The decision against them at this point seems counterintuitive and holds back progress.

It’s important that we keep the momentum of digital ID. Innovation for innovation sake is hollow, but digital ID cards could simplify the ID verification process and make a real difference throughout the UK.

We have seen a tangible engagement with technology in recent months, so now is the time to push forwards and keep development going.

Those which innovate fastest will set themselves apart, but decision makers need to create the right conditions. We hope to see the decision against digital ID cards reconsidered in future.

Conor Murphy, chief executive, Smartr365