By Gal Helemski, CTO and Co-Founder of PlainID

The digital age has brought about a growing need for enhanced privacy and control over personal data. Existing methods of securing personal data have, time and again, proved themselves vulnerable to the growing capabilities of cybercriminals and the risks of unintended leaks. The emergence of decentralised identity and access management (IAM), however, is offering an approach that empowers individuals to take charge of their digital identities and, as such, differs significantly from traditional digitised IDs, offering numerous potential benefits for users and organisations alike.

The decentralised IAM concept is based on a set of open standards that define a self-sovereign identity. In this approach, individuals own their identity attributes and can decide which parts to share with relevant organisations. This is in stark contrast to traditional digitised IDs, where users must share all their information, often exposing more details than necessary or desired.

Decentralised IAM can deliver enhanced privacy by enabling users to take control of their data and choose which attributes they want to share with whom and when. This approach not only respects individual privacy but also aligns with privacy regulations, as decentralised IDs ensure that data flow remains in the hands of users.

Furthermore, this system allows for a clear separation between personal and organisational data, granting organisations access only to the necessary information while safeguarding individuals’ personal details.

Looking at the situation faced by most organisations today, one of the primary challenges with current ID systems is that they contain information that – in certain contexts – can be considered excessive. As a result, users have limited control over their data – they must either share their full ID document or not share it at all, making it challenging to control the dissemination of specific personal details. Consider, for instance, driving licences that include an individual’s address. While these are widely used to confirm age and identity, not every situation requires that the owner reveals where they live.

Granular Control

In contrast, decentralised IDs aim to address these issues by giving people control over their own identities and data. Offering granular control, identity details can be managed and shared based on a specific set of attributes and parameters, such as age or location. Users are empowered to selectively expose attributes to gain various levels of access, while advanced authorisation systems that react to these attributes can be implemented to offer a more secure and personalised user experience. In this way, online services can be tailored to the needs and preferences of the individual – all governed by their willingness to share identity components.

One of the key questions to consider, of course, is how this can be achieved. In simple terms, decentralised identity management can be facilitated through the use of blockchain

technology, which can provide both the required decentralised framework and a high level of assurance. In particular, blockchain’s distributed nature ensures that identity data is secure and not reliant on a single centralised authority.

More specifically, policy-based access control can be used to regulate access to data, applications and services based on an individual’s identity. Decentralised IAM allows access control systems to operate on the attributes provided by decentralised IDs, enabling a more flexible and secure authorisation process.

Implementing Decentralised IAM in Businesses

Decentralised IAM solutions are being increasingly considered and adopted by a wide range of businesses looking to streamline processes, enhance security, and improve privacy. In the healthcare sector, for instance, the approach offers the potential to safeguard sensitive medical information while enabling the secure sharing of health records with selected providers, ultimately contributing to better patient care.

Financial institutions can benefit from decentralised IAM by securely managing customer data, ensuring regulatory compliance, reducing the likelihood of identity theft and facilitating secure transactions. For e-commerce and retail businesses, decentralised IAM allows the creation of personalised shopping experiences that foster trust and loyalty while respecting customer privacy.

In the human resources and recruitment context, decentralised IAM enables companies to manage employee data more efficiently and streamline the onboarding process. Job applicants can securely share relevant information without disclosing their full identity, simplifying the recruitment process. Similarly, educational institutions can leverage decentralised IAM to help students and staff securely manage their digital identities, share academic records and access necessary resources based on their roles and responsibilities.

At a time when identity theft, fraud and personal data misuse are becoming more concerning trends for authorities and individuals alike, decentralised IAM offers the potential to deliver a new era of privacy and control, allowing users to own their data and decide how it is shared. As the technology matures and more organisations adopt decentralised IAM solutions, we can expect to see a significant shift in the way digital identities are managed, ultimately benefiting both individuals and businesses alike.