Banking News

MyCUID, the digital identity for credit unions, leads the way in transforming call centers

call center illustration

CULedger, the blockchain consortium for credit unions, has launched it’s first live use case, a digital identity verification system called myCUID. The aim is to give members and credit union call centers the tools to protect members from theft, abuse, impersonation, or misappropriation.

The call center process

  • The credit union member has an app on their phone which is uniquely identified as theirs.
  • When the member phones the call center there is a double identity check. CULedger sends a cryptographic challenge to the member’s app. Additionally, there has to be fingerprint confirmation by the member on their phone.
  • The call center rep knows whether they can go ahead and talk, saving the time that’s usually needed to authenticate the user.
Fraud detection

The process sounds neat, but it goes a lot further. In addition to verifying the user’s identity, it will help to prevent fraud by sharing information across the distributed ledger.

For example, if someone fraudulently phones the call center of Credit Union A, that union will flag the phone number as fraudulent. If that number is used in a call to a different credit union, even if the caller passes identification, they will be flagged for extra authentication.

“We created MyCUID as a global digital identifier that permits our members to securely interact with their credit union,” said CULedger President and CEO John Ainsworth. “By giving individuals control over their personal identifiable information, MyCUID will create a truly secure and privacy-preserving flow of information to promote balance, fairness, diversity and competition in the digital economy.”

Inclusive

One of CULedger first objectives was to remove barriers to entry for all credit unions so that a union didn’t need to be large to get involved with blockchain early. The inclusiveness extends to the very nature of credit unions.

“There are approximately two billion consumers that are considered underbanked or underserved across the globe. With the support of MyCUID, credit unions worldwide will be uniquely positioned to serve the financial needs of consumers,” said World Council of Credit Unions President and CEO Brian Branch.

Technology and consortium

CULedger has adopted one of the less mainstream DLTs, Swirlds which uses a hashgraph data structure rather than a blockchain. For MyCUID they partnered with Evernym which implements enterprise solutions on the Sovrin identity blockchain.

The CULedger consortium was started in May 2016 by the Credit Union National Association (CUNA), Mountain West Credit Union Association (MWCUA) and Best Innovation Group with an initial budget of $650,000 from 70 credit unions. Though undoubtedly that commitment has now been increased.

The MyCUID concept appears to have great potential across a variety of industries.

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