What additional capabilities can digital identity offer to FIs? CURRENT STATE: Legal entities are often unable to determine their total risk exposure to a given counterpart due to complicated ownership structures and difficulty aggregating a complete view of a legal entity. HOW WOULD DIGITAL IDENTITY HELP? Tra n s a c t i o n counterparties could have a consolidated view of the corporate structure of the entities with which they are transacting, allowing them to determine their total risk exposure to that entity across transactions and lines of business. 98 WORLD ECONOMIC FORUM | 2016 5. DETERMINING TOTAL RISK EXPOSURE CURRENT STATE: It is currently challenging or impossible for entities to identify all entities that are participating in a given transaction; they may not have visibility into the end customer in a transaction that is being completed by a broker or other counterparty. HOW WOULD DIGITAL IDENTITY HELP? Legal entities could request visibility into the consolidated identity of a third party and the ownership history of a given asset involved in a transaction. This would allow them to identify both the direct customer and the end customer in the transaction, better informing the decision of whether to complete the transaction. 6. IDENTIFYING TRANSACTION COUNTERPARTIES
