As digital solutions become increasingly omnipresent, the importance of implementing mechanisms to establish trust in identity in the digital age increases too. Keeping our online identities safe is one side of the coin; keeping ourselves safe as we transact with faceless customers is the other. The complexity only increases when we consider the business transactions occurring on a global scale.
In response, regulators, governments and the companies operating within the global marketplace face pressure from various stakeholders to beef up security measures. This article will outline two mechanisms being used to improve trust and transparency within the global marketplace:
Antwerp Pilot Program: Blockchain ID
Belgium is a pioneering force in digital identification. They currently have eIDs (electronic IDs) available for their residents and citizens that allow them to travel within the EU and affix their electronic signature to documents, amongst other things. Last year, they began a pilot program to implement a blockchain solution making the flow of official documents safer and more efficient.
The documents that are being transferred using blockchain are certificates that guarantee the safety of fruit and vegetables being imported from outside the EU. Prior to this pilot program, a paper version of the certificate would be sent by courier – which is costly and time-consuming.
The digital solution – blockchain – means that all of the relevant stakeholders have access to up-to-date information that is secure and has not been tampered with. The parties involved know who they’re dealing with and can trace the origin of the documents in real time. The secure digital solution saves time, money and reduces the administrative burden associated with the import of fruit and vegetables.
Legal Entity Identifiers (LEIs)
An LEI is a 20-digit alphanumeric code allocated to legal entities that apply for them. They form part of a global system designed to increase transparency and safety and to decrease fraud within the global marketplace, particularly with regard to financial transactions. Each LEI number is unique and each legal entity is only able to be allocated one LEI.
LEIs can be used across jurisdictions around the world as a corporate ID card. All of the information related to an entity’s LEI is freely available via the global online database. The information available relates to the parents and subsidiaries of the company, alongside ‘business card’ details, like its name and location.
The need for the global LEI infrastructure became apparent following the collapse of the Lehman Brothers in 2008. LEIs allow regulators and financial firms to better assess risk and exposure within the global financial system, while also promoting transparency in business transactions. In the long run, this means that companies can improve their internal management of risk, while regulators can better monitor and assess risks within the global economy.
It’s now also possible to embed information about your entity into documents using a machine-readable LEI. This certifies the authenticity of the documents to the readers, thereby improving safety and transparency online. Read more in our article about machine-readable LEIS.