Obama Administration’s National Strategy for Trusted Identities in Cyberspace Could Promote RFID Adoption

The new strategy could encourage consumers to adopt a single credential, "such as a unique piece of software on a smartphone, a smart card or a token that generates a one-time digital password."
Published: April 19, 2011

Apr. 18, 2011—Last week, the Obama administration unveiled its National Strategy for Trusted Identities in Cyberspace (NSTIC), which aims “to better protect consumers from fraud and identity theft, enhance individuals’ privacy, and foster economic growth by enabling industry both to move more services online and to create innovative new services.” This is an ambitious program that could be boiled down to making online transactions safer, reducing risk for both consumers and businesses.

When the initiative is fully implemented—or, perhaps, if it is ever implemented, since many proposals in Washington never become a reality—it could give a boost to the adoption of RFID-enabled smartphones and smart cards. A press release issued by the White House on Apr. 15, 2011, said: “Consumers who want to participate will be able to obtain a single credential—such as a unique piece of software on a smartphone, a smart card or a token that generates a one-time digital password… Consumers can use their credential to prove their identity when they’re carrying out sensitive transactions, like banking, and can stay anonymous when they are not.”

NSTIC aims to create an “identity ecosystem” in which there will be interoperable, secure and reliable credentials available to consumers who want them. “The Internet has transformed how we communicate and do business, opening up markets, and connecting our society as never before,” said President Barack Obama in the White House’s press release. “But it has also led to new challenges, like online fraud and identity theft, that harm consumers and cost billions of dollars each year. By making online transactions more trustworthy and better protecting privacy, we will prevent costly crime, we will give businesses and consumers new confidence, and we will foster growth and untold innovation. That’s why this initiative is so important for our economy.”

No details have yet been revealed, but the initiative could foster the use of smart cards and smartphones with Near-Field Communication (NFC) technology, by supporting the development of an infrastructure that will make the technology more widely available and, thus, more useful for end users. New Google Android phones are being introduced with NFC technology, and while there are some questions about how to use phones to secure RFID-enabled transactions, solutions are being developed. That means your phone could be utilized to sign in to your computer and conduct transactions online—you could, for instance, transfer a movie ticket to your smartphone, and then use the phone to enter a theater.

Once an identity ecosystem is developed, the administration indicated, it would be less expensive and easier for a small business to sell online, since that firm would not have to invest in creating its own secure online payment system. Consumers would no longer have to manage different user names and passwords for each e-commerce site they frequent. Instead, they would be able to employ a single, secure credential for all sites.

“More secure credentials will also help consumers and businesses better protect themselves from identity theft and online fraud, which annually cost our economy billions of dollars and impose a significant cost in time and money to those who fall victim,” the press release stated. “In the worst cases, it can take a consumer over 130 hours to recover from having their identity stolen. According to industry surveys, a consumer will also suffer an average out-of-pocket cost of $631 when their identity is stolen—and millions of consumers suffer this experience each year.”

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark’s opinions, visit the RFID Journal Blog, the Editor’s Note archive or RFID Connect.