What is Federated Identity?

What is Federated Identity?

Federated Identity is a method that enables users to access multiple systems, services, or organizations using a single set of credentials. It allows different organizations or systems to establish trust relationships, enabling seamless access across boundaries without requiring users to maintain separate credentials for each system.

Key Components of Federated Identity

• Identity Provider (IdP): This is a trusted entity provider – either commercial (e.g., Omada), social (e.g., Google), or governmental (e.g., eIDAS) that authenticates users and issues identity assertions (e.g., tokens).
• Service Provider (SP): An entity (application or IT system within an organization) that relies on the identity assertions from the IdP to grant access.
• Federation Standards and Protocols: These protocols enable the secure exchange of identity information between IdPs and SPs. Examples include SAML (Security Assertion Markup Language), OAuth, and OpenID Connect.
• Trust Relationship: Agreements between IdPs and SPs define how authentication and identity data are shared.

How Federated Identity Works

The user authenticates with their credentials at the IdP.

• The IdP generates an identity assertion (e.g., a token) that confirms the user’s identity and attributes.
• The user presents the identity assertion to the SP.
• The SP validates the assertion with the IdP and grants the user access to the resource.

Benefits of Federated Identity

• More Efficient User Experience: Users need only to log in once with Single Sign-On (SSO) to access multiple systems or services without the need to repeatedly authenticate their identity. This eliminates the need for users to remember multiple credentials and dramatically simplifies the process, enhancing the overall user experience.
• Improved Security: Centralized authentication enables consistent enforcement of security policies like multi-factor authentication (MFA). This eliminates the need for multiple login points and reduces the size of the attack surface.
• Cost and Administrative Efficiency: By eliminating the need for separate credential databases across systems, Federated Identity simplifies user management and makes the overall process more efficient.
• Cross-Organization Collaboration: Facilitates secure access for employees, partners, contractors, and vendors – both on-premises and remote – without having to create new accounts in each system.

Federated Identity in Practice

• Business Applications: Employees use SSO to access internal tools, cloud applications, and external services. Organizations can also use Federated Identity to collaborate with contractors or partners to grant access to specific systems in their IT infrastructure.
• Use Cases in Education: Students and faculty access shared academic resources across institutions through federated systems.
• Government Services Access: Citizens can use a national digital ID to access multiple government services securely.

Security Issues Associated with Federated Identity

While the Federated Identity method enhances user experience and makes access management more efficient, there are a range of security threats that organizations must recognize. Federated Identity relies on centralized authentication processes and trust relationships, so any vulnerability or breach in a Federated Identity environment can have widespread consequences. Here are several threats to consider:

Credential Compromise and IdP Breaches

If a user’s credentials are stolen from an IdP, attackers can impersonate the user across all services that rely on the Federated Identity. An IdP breach could expose all federated accounts to unauthorized access.

Token Theft and Replay Attacks

If tokens are intercepted or stolen, attackers can use them to access services without needing user credentials. An attacker can also capture a valid token and reuse it to gain unauthorized access.

Man-in-the-Middle (MitM) Attacks

Attackers may intercept unsecured authentication traffic between the user, IdP, and SP to steal credentials or tokens. Misconfigured trust relationships between IdPs and SPs can result in unauthorized access or excessive permissions that elevate this risk.

Dependency on Third-Party Identity Providers

Organizations relying on external IdPs for authentication may suffer if the IdP experiences outages, breaches, or policy changes.

Insider Threats

Malicious or careless insiders with access to Federated Identity systems could abuse their privileges.

Lack of Access Revocation

Failure to revoke access promptly when roles change or accounts are compromised can leave systems exposed.

Where to Learn More

Federated Identity introduces convenience and scalability, but managing the threats associated with it requires a robust SaaS-based Identity Governance and Administration (IGA) solution. A solution like Omada Identity Cloud enables organizations to balance usability with security by providing complete visibility and control over the identity landscape. Omada Identity Cloud leverages real-time data processing to streamline the entire identity lifecycle, bolster security, and optimize efficiency.