Should the property industry spend more time and money on implementing digital ID systems which may be rendered obsolete or non-compliant by future legislation? Stuart Young is managing director of Etive, the company leading the MyIdentity scheme, a recognised industry standard for carrying out customer identity verification and anti-money laundering checks of home buyers and sellers. The MyIdentity trust framework was set up with public funding to design and develop a digital identity trust framework to support residential property transactions and has had the input of 106 organisations, including five government departments and estate agency, legal and financial services trade bodies and regulators. But now, Stuart says it’s time to pause the roll-out of digital ID in the property sector amid concerns over its negative implications.
The government’s digital identity ambitions are highly criticised in a Home Affairs Committee report, Mandatory to manageable: the government’s plans for digital ID, which concluded that “weak policy development and a rush to announce left plans for mandatory digital ID doomed to fail and destroyed public confidence from the outset.”
Published just seven days after the King’s Speech, which reaffirmed the government’s commitment to digital identity, the report exposes growing concerns about clarity, coordination and confidence.
The committee argued that ministers failed to articulate a compelling case for digital identity and criticised “optimism bias”. Across the property industry, concerns also emerged about ‘confirmation bias’, with key decisions shaped by a small group of organisations.
Implications for the property sector
For the property sector, the implications are significant. Property stakeholders are already subject to stringent CDD obligations, yet the digital identity landscape remains fragmented and uncertain. Conflicting views across government departments, regulators and industry groups have created ambiguity over policy direction and the role of private sector providers. The government’s framework (DVS) remains as voluntary guidance only and does not adequately reflect the complex needs of the property sector.
Under the UK’s money laundering regulations, firms “remain ultimately liable for applying CDD measures appropriately, even when using third-party services”.
Risk and liability remain with each firm.
Conflicting consumer and industry interests
Genuine customer benefit has remained absent. Without a unified approach, customers must complete multiple identity checks during a single transaction, paying repeated fees. Rather than reducing friction, digital identity processes are increasing both costs and delays.
Concerns are also growing around industry steering groups becoming battlegrounds for competing commercial interests. The Home Buying and Selling Council (HBSC) initially generated optimism, before focus shifted to the Digital Property Market Steering Group (DPMSG), launched at the London Digital Property Market Conference in September 2023, though many in the industry raised immediate concerns about its role and remit.
Focus has now moved to the Centre for Finance, Innovation and Technology (CFIT) and its Open Property Roadmap. Critics argue that the same organisations continue to influence discussions, raising concerns that outcomes are predetermined before wider consultation and critique takes place.
When is the right time to invest?
Should the property industry continue investing in digital identity solutions whilst policy remains uncertain?
It is evident that the same mistakes are being repeated as previous government initiatives. Simeon Hanfling, deputy director for insights and engagement in the UK Cabinet Office’s Digital ID Task Force, identifies interoperability, governance and inclusion as major challenges. Without broader collaboration, transparency and willingness to challenge existing assumptions, meaningful progress remains elusive.
Despite criticisms, digital identity could eventually play a positive role in modernising property transactions – but achieving that will require a far more inclusive approach that prioritises practical delivery and consumer confidence.
We remain a long way off, optimistically 2029, as the government builds its own identity infrastructure, if we don’t have a change at the top.
About the author
Stuart Young has been involved with the UK government’s flagship digital identity programme since 2014. He has worked across estate agencies, legal and financial services firms and government to lead the design and development of a trust framework for customer digital identity, built specifically to support residential property transactions. In a sector involving multiple regulated parties, each with distinct legal obligations, the MyIdentity framework has addressed these challenges with public and industry funding and support.
