Banking identity – shift in digitalization not only in regards of the public administration

A positive novelty this year in the world of law and digital technologies is the banking identity. In this article, we will discuss what a bank identity is and where is it useful.

What is banking identity?

Bank identity is a form of digital identity that is used to verify the identity of a bank client – a natural person - in an online environment. Banking identity is a “digital ID card" of its sort. Clients of banks with established access to internet banking will thus be able to use it to access public sector services, and from the second half of 2021 also to private sector services.

However, the banking identity service cannot be offered by any banks, but only by those that have obtained the necessary accreditation from the Ministry of the Interior. Currently, only ČSOB, Česká spořitelna, and Komerční banka have such accreditation; however, other banks are also striving to get it. Therefore, if you are not a client of the above-mentioned banks and you want to use banking identity services, we recommend following the current list of granted accreditations published on the website of the Ministry of the Interior.[1]

Banking identity and eGovernment

The main advantage of the banking identity is that it further facilitates communication with the public administration through its eGovernment platforms [2], i.e., a set of tools of the digital state administration enabling, among other things, handling of matters with authorities electronically.

One of the most well-known eGovernment portals is the Citizen's Portal (Portál občana), which serves to resolve various actions concerning public authorities on one side and a citizen on the other, all that from a distance. On the Citizen's Portal, you can obtain an extract of the driver's point rating, criminal record, trade register, but also file a tax return, obtain a trade license, or access your eReceipt [3] - all online from home.

It is the bank identity that allows logging into the Citizen's Portal (and other eGovernment services) without having to sign up anywhere else. Signing in through a bank identity consists in the fact that the user enters login details into his internet banking and the bank is then able to identify him and verify his identity - in this case in order to communicate with public authorities. In addition, thanks to the fact that banks are newly granted access to basic registers (e.g., population register, information system for foreigners), all information about their clients will be up to date. Banking identity enables what was previously possible only through a data box, ID card with an electronic chip, or identity via the International ID Gateway.

Banking identity in the private sector

The goal of the banking identity project is also to cover the identification of persons in the private sector, for example from telephone operators, energy suppliers, or e-shops. With the client's consent, the bank will be entitled to confirm his identity and provide information about this client and the client will be identified for the needs of a private company. For example, a client will be able to sign an online contract with a private company through a banking identity, with the effect of a guaranteed electronic signature, or use their banking identity to sign into different client zones or accounts instead of entering individual login details for each individual platform.

Private companies that are interested in using banking identity services in their business activities will be able to do so based on individually concluded contracts with banks, such bank services will be charged for private companies.

How to a banking identity?

The ways of obtaining a bank identity differ from bank to bank. Some banks establish the banking identity without further ado, and only on the basis of a change in their general terms and conditions, while others require the cooperation of the client, such as signing the relevant contract. The method and conditions of its deactivation then again depend on the approach of individual banks.

In conclusion, the establishment of unified access to eGovernment platforms using login details for Internet banking and, over time, probably also to the platforms of private companies in the form of banking identity represents a successful shift and simplification in both digitalization of the state and the private sector. Especially now that we spend more time online than ever before, this initiative is welcome and will undoubtedly appeal to many users.

Authors: Michaela Horváthová and Sabina Gargošová

This article was published on © EPRAVO.CZ.