CULedger, a credit union-owned CUSO, provided this post on how credit unions can earn digital trust with members, and why decentralized identities can help in that effort.
The COVID-19 pandemic has not only changed the way we’re currently living our lives and interacting with one another—it has also changed how credit unions serve their members. The top priority of credit unions right now is keeping employees, volunteers and members safe, while remaining in a position to serve members during and after this crisis.
Maintaining and continuing that service comes down to one thing: trust. Credit unions have been a trusted financial resource for members since their inception—and that has been the key advantage our industry has over banks and FinTechs. It is ingrained in our industry’s creed as not-for-profit, member-owned cooperatives. This is the credit union difference: deeper, more personal member relationships, better rates and lower fees, and always putting members first.
Those core values are at the center of building digital trust as well. Digital trust is earned by instilling member confidence in the ability of the people, technology and processes your credit union employs to create a secure, private and reliable digital world.
Since the increased digital connection between credit unions and their members’ personal devices can generate an increase in cyber and privacy risks, you can count on scammers and fraudsters to be quick to try and exploit our members’ fears and sense of compassion. We’ve already seen the current COVID-19 crisis spawn a spike in online criminal activity. Spoofing and impersonation attacks in the call center are two of the most common types of fraud that financial institutions and consumers have experienced an increase of during this pandemic.
If members have digital trust, they won’t feel the need to worry about the possibility of being victims of such fraud, even in times of crisis like this.
Using decentralized Identities
Decentralized identity creates a faster, more secure method to confirm a member’s identity because it is built on blockchain or distributed ledger technology, which reduces the role of centralized identity providers in managing trust—and can possibly circumvent central authority altogether.
While it may seem counterintuitive to some, decentralized identities also create a more personal member experience. They enable credit unions to consistently and securely verify a member’s identity within a few seconds, eliminating the need for personal login questions. They give individual members full control and ownership over their personal information, allowing them to selectively disclose only the information they choose when conducting business with their credit union.
By adopting a KYC-compliant, member-controlled, interoperable digital credential built on the latest in privacy-enhanced technology, credit unions can enhance digital trust with their members by giving them confidence that their credit union is protecting them and has their best interests at heart—part of what credit unions have done since their inception.
MemberPassTM, a service offered by CULedger, is the simplest, most secure decentralized identity solution to verify your members. The privacy-enhanced technology enables your credit union to accommodate your members’ needs for privacy and security in an innovative, modern way while ensuring their personal information remains with the member. To learn more about MemberPass, visit www.memberpass.com or email us at email@example.com