“ Blockchain’s decentralized identity management can bring about revolution in securing the most sensitive aspect of any industry.”
Data insecurity, especially when the data is identity related, is what the enterprises are at high risk today. Major sectors like government, insurance, healthcare, aviation and others that are relatable, are all striving for securing the customer data that is of high value in the processing mechanism. As Blockchain promises data security and immutability, it is also sure to bring about high value in securing identity management through decentralised identity management systems.
Challenges in conventional system:
At various sectors even today the data collection and storing mechanisms are outdated. This leads to slow processing of data as well as high risk data security. The identity data specially is so sensitive yet is so vulnerable in the conventional system that it’s high time to implement proper mechanisms in place.
The data becomes highly vulnerable to hacking risks, and ultimately a high chance of identity intrusion can occur, which can prove to be a great hazard to the system. Internal corruption or data hacking is now a great challenge that is being faced when it comes to security of identity related data at the enterprise levels.
Separate KYC companies, from all the different sectors can bring in a lot of expenses. KYC companies charge a lot to procure the data and store the same. Even then they cannot assure data security to the data that is being stored , digitally or offline. Hence along with data insecurity, high expenses is another big challenge.
Low data control:
Due to lack of data processing and handling mechanisms, the identity data storage faces low data control , ultimately leading to low level of data security.
Wasting data storage:
The KYC processes are repetitive with every other sector that needs the customer KYC details. As the process is repetitive and not stored for reuse by other sectors, it wastes a lot of data storage along with making the process highly lengthy.
How Blockchain’s decentralised Identity management can help:
Blockchain is the decentralized data ledger. The blocks stored on the blockchain are immutable unlike databases. Data cannot be altered or deleted, it can just be appended with new or changed data. This immutable feature of blockchain’s decentralized identity management can lower the risk of insecurity.
High end proces:
The process includes, right from installing the requisite application to approving the data only through smart contracts. Once the app is installed and the data is requested for, from a third party it is analysed for consent through smart contract and is made accessible only when the constraints are met.
Unique Identification system:
For customers it’s beneficial to have a unique identification management system that can be approved once and used multiple times at multiple locations for multiple requirements.
It saves a lot of time to get the KYC approved once, for all the required transactions.
Even If the KYC is done once and the consumer is given the unique identification, the data can never be shared without the consent of the customer. During the smart contracts processing the data is made available only when there is consent from the customer, who is also one of the smart contract partners.
Without having the risk of data loss, the data is stored in distributed fashion, in blockchain’s decentralised identity management, and is secured with the encryption methodologies, making it less vulnerable to data theft.