THE BLOG

Game Over As Peak Password Hits Generation Overwhelmed

31/08/2017 13:42 BST | Updated 31/08/2017 13:42 BST

Experian's research has revealed a growing generational divide in the way the UK population manages its online identities. Millennials are at high risk from online identity fraud as they favour convenience over security concerns. However, there is a divergence in the way different age groups conduct themselves online, causing inconvenience on one hand - and threatening online safety on the other.

A generational divide where password are concerned

Our research has shown that people across the generations have very different attitudes towards the way they navigate the internet and manage their online accounts, or online IDs.

The younger generation appears to be more driven by convenience, and rarely have more than five unique passwords. They are also far more likely to log in to multiple accounts using a single social media online ID. But what they may not realize is that this thirst for convenience leaves them more vulnerable to the threat of identity fraud. In fact, there has also been a sharp increase in the number of cases affecting this age group. Fraud is now the most commonly experienced crime in England and Wales, with most offences committed online, according to the ONS.

Experian's latest Hunter statistics show an increase of five percent year-on-year in those under 30 becoming a target of identity theft, with people living in rental hubs particularly vulnerable: More than one in three cases of third party fraud are carried out against this group. Moreover, in the last three years, fraudulent credit applications for those aged 20-24 has increased by a massive 43 percent, while the rate for 25-29 year olds has increased by 23 percent.

At the other end of the spectrum, the older generation were found to be much more likely to use multiple passwords to log in to their online accounts, placing more value on a cautious approach to security at the expense of convenience. One in four admitted to using a memory-taxing 11 or more password combinations. Perhaps it's no surprise that the fraud rate is seen to be falling for all age groups in the 40+ bracket.

It's perhaps no surprise, then, that a high proportion of over 55s admit to having problems remembering their codes. This memory strain is a growing problem, with four in ten people stating that they need to use a password memory service to help them remembering all their passwords. While more than half (55%) of those surveyed admit to using the same password for multiple online IDs.

Online identity confusion

There is also significant confusion about what an online ID is (a login for an online service) - with one in three (31%) of those surveyed admitting they did not know and a further 61 percent choosing different definitions to explain an online identity.

Three in five (61%) people in the UK admit they don't always understand what they are agreeing to when they sign up for a new profile online, with one in nine (11%) conceding they never understand.

The typical person in the UK has an estimated 26 online accounts, or online IDs, with between six and 10 passwords that they use regularly as convenience becomes increasingly important to consumers, the all too familiar and often frustrating process of answering several security questions to prove who you are, and recover your password, could become unsustainable.

There are proactive steps customers can take against fraud, and it's important that all businesses remind customers to take them. These include:

1. Don't respond to unsolicited emails and phone calls

2. Use different passwords for different accounts - particularly for your email account and online banking

3. Use strong passwords made up of three random words, plus numbers and symbols, and use a combination of lowercase and uppercase letters

4. When using public Wi-Fi, don't log in to any sites that need a password (e.g. your bank, social media or email) or enter personal information such as your card details

5. Always download the latest software on your phone, tablet and computer. This will help protect against malicious software

Time to get smart?

Given the rising amount of fraud, and the major impact that it can have on consumers, it may be that acceptance of, and demand for biometrics will increase.

Fingerprints, voice analysis, iris patterns, vein matching, gait analysis and more, biometric data are unique individual traits - and generally - difficult to fake.

With the right technology, biometrics is likely to offer speed and scale to unlock the value in digital customer journeys by creating much harder to break security for consumers that account holders don't even have to remember. And whilst there's a degree of unease around hyper-connectivity and personal privacy, with the right restrictions, well informed guidance and secure storage, safety shouldn't be hindered in the least.

Of course, it's fair to argue that even biometrics will, in time, become as vulnerable as other platforms. All technologies are in an arms-race as criminals try to crack them and business tries to improve them. To that argument, smart technology and biometrics will be best used as an additional layer to security. It may not be for everyone but it's another tier of protection against identity theft that adds a significant barrier.

The full research is on the UK's online ID habits are available in two parts:

The Evolution of Identity

The Future of Identity