Insights & Analyses

As access to financial services expands, your cellphone number could become the new SSN

April 13, 2017

For years in the U.S., the Social Security Number has been the gold standard in identifying and verifying the credit history of prospective customers. But as financial institutions look to reach new and untapped markets, the legacy SSN may give way to a modern and potentially more secure string of digits: the cellphone number.

Consumer identity data company Whitepages Pro believes it’s not just the technology behind smartphones, but the phone numbers themselves, that could prove crucial in identifying the next billion users.

“A mobile phone number is sort of a de facto replacement for a Social Security Number,” Will Wyatt, Whitepages Pro VP of sales and account strategy, said on the latest episode of the State of Identity podcast. “It is truly global in nature, and people will very frequently have their cellphone with them on a regular basis than they will any other form of identification.”

Many consumers are already familiar with mobile security methods, where they are texted a number they must then re-enter to verify their identity. That same method could prove integral for financial institutions, trying to reach people who are underbanked and underserved by current methods.

The catch, of course, is verifying that the number provided by the applicant is actually owned by the person they claim to be. In this way, banks will need to do something that goes beyond standard two-factor authentication, typically used to verify less crucial web accounts like Gmail or Apple ID.

“It’s very important to take a multi-layered approach,” Wyatt said.

That’s where wireless carriers come in. Previously reluctant to participate, Wyatt said that network providers have in recent years become more willing to provide identity information associated with mobile phone numbers.

This piece is key to ensuring that an applicant is who they say they are when trying to open a bank account or obtain a loan from their mobile device.

The ultimate goal, of course, is to reach the portion of the population that has not historically opened a bank account or applied for credit cards or loans. Based on demographics and income, those same people may not be likely to use one of the “big four” wireless carriers in the U.S. — Verizon, AT&T, Sprint and T-Mobile.

That’s where companies like Whitepages Pro come in, providing institutions with identity verification solutions that could potentially verify a user’s identity with any carrier. With more than 3,000 wireless providers in the U.S. — including budget, regional and pay-as-you-go services — it will take some work to actively reach and identify those who have been underserved by banks.

For more, subscribe to the State of Identity podcast, and stay tuned for new episodes published every week.