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I read a depressing letter in the Observer this week. It was sent in to Anna Tims, the author of the paper’s Your Problems column, and was titled: Credit rating sullied after fraudster took out a loan.

Someone took out a payday loan of £440 in the victim’s name with a company called Lending Stream. That in itself is not shocking. What is shocking, is that the criminal only needed the victim’s name, date of birth and address to get their hands on the money. Combining the fraudster’s own bank account, email address and mobile number with the victim’s name, date of birth and address was all it took.

When the fraudster defaulted on the repayment, the amount due doubled. It then took five days for the victim to reach Lending Stream’s fraud department (I imagine they’re pretty busy). The victim was promised callbacks that never came, got lost in Lending Stream’s telephone redirect system and was apparently hung up on. Eventually, the news came that their credit report would return to normal in 45 days.

That simply isn’t right. It’s embarrassing how easy it is for fraudsters to take out loans with such basic personal information. Checking name, date of birth and address to the electoral roll through an identity data provider gives no assurance the form filler is the right person. It just doesn’t cut it as a reliable means of verification anymore. It’s small wonder online identity fraud is rocketing.

But I believe it’s only a matter of time before businesses that don’t recognise digital identities, instead relying on data filled in on web forms—a gift horse to fraudsters—will fall behind smarter competitors and lose good customers.

Yoti allows individuals to verify their personal details and in future bind their bank account to their Yoti. It’s a potent anti-fraud measure that will help lenders like Lending Stream quickly and easily verify that a person looking to take out a loan is who they say they are, and owns the bank account Lending Stream transfer the money to.

Right now, life is too easy for fraudsters. But in years to come it will be much harder for fraudsters, and safer and easier for honest people.