Security concerns are the key barrier for consumers from being more open to adopting digital identity for home buying and renting or for mortgage applications, according to the National Housing Survey (NHI) conducted by Fannie Mae. The GSE had surveyed consumers on their perception of digital financial identity in the second quarter of 2017 and published its findings on Tuesday.
Digital identity is an electronically verified set of attributes that uniquely describe a person and can be beneficial in providing simplified application processes, swift transaction approvals, lower costs, and enhanced security and can also be used to speed up financial transactions
But consumers are still wary about using it more actively. Their biggest concern? Security and safety of their personal information. The survey found that 50 percent of the respondents cited this as their biggest concern. At 18 percent consumers also cited using the information for purposes other than what the individual intended it for as the second major concern for them when it came to sharing a digital identity.
Even if digital financial identity delivered meaningful mortgage origination benefits, the survey said, most respondents said they would not be more interested in it with 42 percent saying they would not be more interested if it reduced their mortgage origination costs by $500 and 47 percent being disinterested even if it meant instant mortgage approval, eliminating the need to produce any financial documents, or closing the loan within two weeks.
The survey found that only 13 percent of Americans were interested in having a digital financial identity. They included millennials and those with higher education and higher incomes. And if they had to be created, half of the respondents believed that large financial institutions or the U.S. Government should be in charge of these identities.
Together, large financial institutions and the U.S. Government got 48 percent of the vote from respondents. However, 23 percent said none of the institutions should be in charge of an individual’s digital financial identity.
To know more about what America thinks of digital financial identity, click here.