The Rhode Island secretary of commerce wants to take a streamlined approach to managing resident and business identities and hopes that a centralized data lake and distributed ledger technology can lead the way.

Secretary Elizabeth Tanner said GovTech which hopes to move away from current practices that see constituents separately provide and update their personal and business details at each different agency they have to interact with. Instead, he hopes to allow voters to enter their details in one place and then later use digital wallet apps to access their information.

Tanner predicts that a centralized data lake and distributed ledger could underpin the approach. The idea is that a distributed ledger would securely store data and enable a digital identity wallet, while the centralized data lake would save agencies from keeping their own separate records of a person’s or company’s identifying details.


The state tested the distributed ledger in a pilot earlier this year, in which the technology was used to manage the credentials of a certified public accountant (CPA). Now, Rhode Island looks to take the idea even further, starting by bringing a distributed ledger and centralized data lake to streamline the business registration process. He will be issuing a request for proposals shortly.

THE PILOT

Rhode Island explored the feasibility of distributed ledger-supported identity management in a pilot project that concluded in June. In this process, the state used a network of distributed ledgers to immutably store records of who had obtained CPA licenses. Professionals could then access their certifications on their phones, using a digital wallet app. The app will run a check on that distributed ledger network, to confirm the existence of a block containing the CPA’s certification. This approach allows CPAs to quickly display their certification statuses, without having to view other identifying details as well.

The project, in part, aimed to make it easier for CPAs working across state lines to prove their professional standing when handling matters such as filing tax returns in other states, Tanner said.

“The pilot was just focused on proving it could work,” said Tanner. “This proved that we could recover a digital credential through the government system.”

Tanner’s department now wants to build on that idea and see if distributed ledger technology and a centralized data lake could streamline business registration processes. The goal is to simplify the way business owners submit information during business registration and allow business owners to use a digital wallet to access business license information.

“We want to expand that to be able to create a corporate identity associated with your personal identity and be able to perform the function of organizing your business,” said Tanner.

Rhode Island will launch a request for proposals on that project in the “coming weeks” and is open to suggestions on how to improve or change the project from what is currently planned, Tanner said. The State General Assembly will review the results of that project when considering whether to fund such services in the coming years.

DATA LAKE SIMPLIFIED

In many states, people registering a business must provide details to the Office of the Secretary of State, the Division of Internal Revenue Service, and the Department of Labor and Training. But Tanner hopes to simplify all of this by launching a single government website where people can enter their basic identifying details, such as their names, addresses and business names. These details would feed into a central data lake that all relevant government departments could view.

Under this plan, voters would also use the site to submit additional, more sensitive details, which would be passed to specific departments rather than the data lake. For example, the Department of Labor and Training needs a company’s employee headcount, while the Secretary of State needs to know its registered agent, and the Division of Taxation needs the employee’s Social Security number. agency. Such agencies would separately maintain and protect that information.

The new processes could reduce steps for components, as well as reduce confusion for government personnel. When each agency has its own component records, government employees can spend a lot of time determining whether records with similar names refer to two different people or entities or to the same person using a nickname or abbreviation.

“If my formal restaurant name is ABC Restaurant, sometimes I’m called ABC’s, sometimes I’m called ABC Restaurant,” Tanner said. “So being able to have a method of identification for a name and a company is a huge problem solver in government.”

HOW TO SECURE THE DIGITAL ACCOUNT

The second part of the plan requires distributed ledger technology.

“The distributed ledger is only part of the project,” Tanner said. “We use it a lot from a souped-up Excel spreadsheet perspective.”

Distributed ledger technology, or blockchain, stores data in chunks known as “chunks.” When a block’s memory is full, the block is closed, time-stamped, and linked to the last closed block in the chain, according to Investopedia. The chain and timestamp create a timeline of how a record was updated. Furthermore, the blocks cannot be reopened, thus making the information stored in them unalterable.

This immutability appeals to Rhode Island, and plans call for storing data lake information in chunks. Of course, people’s personal circumstances are not immutable, and updates to resident information, such as losing a license or changing the listed name or gender, would be added as new blocks in the chain.

Tanner also aims to use open source technology, “so other governments can copy what we do,” and hopes the effort will reduce fraud enough to convince the House that this approach deserves continued funding.

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