Should my business accept Digital IDs for retail alcohol/tobacco sales?

We all want to be progressive and keep our customers happy. With technological advances that seem to be occurring daily, customers are demanding the “convenience” that technology seems to afford – like being able to show a digital ID to prove their age for restricted products.

Currently, residents of Arizona, Colorado, Maryland and Georgia can add a digital driver’s license to their phone. Several airports, including Ronald Reagan National Airport and Atlanta’s Hartsfield Jackson International Airport have added machines where travelers can present their digital ID at TSA checkpoints. Other states like California, Delaware, Florida, Louisiana, Mississippi, Missouri, Oklahoma and Utah have created mobile ID apps to facilitate the use of digital IDs. Different states use digital IDs in different ways. This post will discuss the use of digital IDs in connection with age-restricted products.   

Digital IDs and Law Enforcement

Although many states have the technology to allow citizens to add their driver’s license to their digital wallet, they also often distinguish that only certain entities (such as the TSA) have the authority to rely upon digital versions of someone’s ID. This is because the technology to accurately “verify” a digital ID is not widely available. Georgia law enforcement does not accept digital IDs – meaning you’ll still have to show a tactile ID in Georgia if you get stopped by a police officer. 

Digital IDs and Alcohol

The post-COVID trend of selling alcohol to-go or online will only continue to grow. According to one estimate, online alcohol sales around the world will likely increase at an annual compounded rate of 2% through 2025. However, with that growth comes risk and liability. The use of digital IDs may help curb some unauthorized purchases of age-restricted products. However, reliance upon digital IDs in this application reduces human interaction which can lead to error if there is not proper verification at the point of delivery that the person accepting the alcohol is the person whose ID was provided. This can happen in your business as well. Any technology relied upon should be able to verify the validity of the ID and verify that it belongs to the person making the purchase. 

The expense of the technology that can properly verify digital IDs makes it accessible to entities like the TSA, but likely not cost-effective for the average restaurant, bar, or convenience store. The high cost of the machine coupled with the training and operation of such might be too expensive for a retail business. If you’re interested in this technology, don’t fret. Cost effective solutions may be around the corner. One method currently being used in Florida is for retailers to partner with SmartID. Residents there can upload their ID onto a SmartID app and then use the platform for age verification with participating partners of the state-approved, Florida Smart ID Verifier program. This platform has the ability to require the resident to also provide a “selfie” upon the attempt to purchase alcohol online, thereby creating an added layer of proof that the purchaser is who they say they are.  

Conclusion:  We’re not quite to the point of seeing Digital IDs in mainstream retail.  However, for businesses that sell age-restricted products, the ability to effectively rely upon digital IDs may be right around the corner. The ground rules for the use of digital IDs are still being developed. Regulators and legislators will likely be using these preliminary testing stages and digital ID platforms to develop acceptable procedures for the use of digital IDs in retail establishments in their states.