Banks in Finland are cashing in on state and local government online services, as they charge authorities on the national and regional levels six cents whenever any of us log in to state or municipal online service sites.
The Population Register Centre launched an electronic ID card in 1999, much like the one in use in Estonia today. Despite a concentrated nationwide effort to meet the strictest of security requirements, the electronic IDs were rejected by Finland’s local banks. Because it was not accepted universally, the card never took off.
Finland’s banks solved the problem by developing their own login and authentication services.
Today 99.5 percent of online transactions involving the national or local government are carried out with these bank-inspired platforms.
Better this way
The Ministry of Finance has negotiated a framework agreement with the banks about the service fees associated with government authorities’ online services.
Ministry specialist Markus Rahkola estimates that the unsuccessful attempt to introduce an electronic ID card may have ended up being a blessing.
“The current arrangement is very cost-effective from a public administration point of view. Registering for online banking is easy and everyone knows how to use it,” he says.
Rahkola says it’s clear that trying to go back using a card would be a step in the wrong direction.
“Government and the banks are currently negotiating the construction of an extensive nationwide credibility network, whereby each member participating in the community would agree to the same login protocol. This will facilitate online transactions to an even greater extent,” he says.
“In the future we will hopefully have strong, independent login and authentication service providers that subscribe to these common market practices. Then government authorities could put their online services out to tender in a completely different way than is possible now among the existing banks.”
