Credit bureau TransUnion is diversifying its online security services with a strategic partnership announced this week with Dashlane, provider of a fast-growing password-management platform.
TransUnion led a $22.5 million Series C round of funding in Dashlane, bringing the New York-based startup’s total funding to $52.5 million, the companies said May 25.
Dashlane, which launched its password-management service in 2012, provides a digital wallet that stores all of a consumer’s online payment methods. When checking out on an e-commerce site, Dashlane prompts users to select a payment method, then streamlines the process by automatically filling in shipping and payment information.
Dashlane also protects the security of users’ passwords with digital identity management, emergency access and its Password Changer service, which automatically changes users’ weak or compromised passwords.The company said it’s facilitated $6 billion in e-commerce transactions to date, and plans to introduce password security services for businesses in the near future.
Currently Dashlane’s services are free to consumers using it on a single device; consumers can use the service on multiple devices for $39.99 a year. Dashlane said it has more than 5 million customers in 150 countries using its service.
TransUnion plans to work with Dashlane to create service focusing on credit monitoring, identity and protection against data breaches and other threats to the security of consumers’ credit information, TransUnion said.
“We feel TransUnion, with its vast array of credit and identity protection services and its global consumer reach, can help accelerate Dashlane’s growth even further,” said John Danaher, president of TransUnion’s Consumer Interactive, in a press release.
Rho Ventures, FirstMark Capital and Bessemer Venture Partners also participated in this week’s Series C round for Dashlane.
Earlier this month, Dashlane said it formed a partnership with Citigroup’s Banamex, Mexico’s largest bank.
Research from Aite Group suggests more than half of consumers use the same password for access to all online sites, said Julie Conroy, a senior analyst with Aite.
But Conroy said she’s “bearish” on the long-term potential for password-management platforms, because of their inherent weakness.
“On the one hand, these password-management services provide a way to create and remember strong passwords that are different for each online relationship,” she said. “That certainly has near-term value, since we’re seeing such an uptick in account takeover as a result of the myriad database breaches that entailed credential compromise.”
But password-management platforms also tend to create a single point of failure and exposure, which are great targets for hackers, she said.
“I think we’ll see a gradual diminishing use of passwords over time,” Conroy predicted. “Ten years from now, I think the password as the initial authenticator will be much less ubiquitous than it is today,” adding that combination of other security factors, plus technology to link a device’s location to a user, cross-check device ownership and biometrics, will likely displace passwords.