Decentralized identities: More control and security for your data

Digital identities are fundamental components of modern business processes. They play a crucial role in online commerce, banking, the public sector, remote access and administrative activities. However, traditional identification methods are often complex, resource-intensive and involve the disclosure of extensive personal data.

What are decentralised identities (DIDs)?

Decentralised identities, also known as self-sovereign identities, take a new approach. Users retain complete control over their identity data and decide for themselves what information they want to share with which organisations.

DIDs are based on a cryptographic key pair and a tamper-proof anchor in the blockchain. This creates a secure basis for verifying digital identity credentials without the need to store centralised identity data.

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Decentralised identities: why they are relevant for businesses

Companies are facing the challenge of managing an increasing number of digital identities. This affects internal employees, external customers, as well as machines and services in cloud-based architectures. At the same time, regulatory requirements are increasing, for example through NIS2, the EU-wide directive to strengthen cyber security, or the EU regulation on electronic identification, authentication and trust services (eIDAS 2.0).

The KPMG Cloud-Monitor shows how strongly the demand for digital identity solutions is growing. Many companies want cloud solutions that enable greater data sovereignty and transparency. Decentralised identities help to make digital interactions more secure, efficient and easier to verify.

Results from the KPMG Cloud Monitor:

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Uncertainty regarding identities and access options

Only 26 per cent feel well prepared for NIS2

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Desire for data sovereignty

58 per cent consider secure cloud solutions to be a "must-have".

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Increasing demands on identity standards

Standardised and auditable identities are increasingly becoming a must.

Added value and benefits for companies and users

Decentralised identities create security and reduce administrative effort: companies no longer need to maintain large databases, credentials are forgery-proof, and users only disclose the information that is necessary in each situation. At the same time, identification becomes significantly faster because manual checks are no longer necessary and processes are completely digital. Roles and contexts can be mapped flexibly – an advantage for employees, customers and automated systems.

Use cases in various industries

In the financial sector, decentralised identities can simplify KYC processes, account openings, and contract conclusions, for example. Healthcare organisations benefit from secure identification of staff and patients without sharing unnecessary data. Public administrations can also make administrative procedures more efficient and secure. Industrial companies use DIDs for machines or IoT components, while HR departments can speed up onboarding processes and provide digital proof of qualifications.

Our services and solutions

We support companies throughout the entire DID lifecycle – strategically, technically and organisationally. To this end, we develop clear objectives, review existing structures and determine how the new identity model can be integrated in a meaningful way. During implementation, we design suitable digital credentials, test them with selected user groups and integrate them into existing workflows. For long-term operation, we establish clear rules, security standards and training programmes to ensure that the new identities are stable, secure and understandable for everyone.