Before we can answer this question, we first need to define what identity is. Too often authentication is used interchangeably with identity, but that’s like saying a bank account and money are the same thing.
In its most basic terms, authentication is the ‘what-of-you’ and identity is the ‘WHO-of you’. You can authenticate via a password to log into your computer or buy a cup of coffee, but if you want a mortgage, considerably more background information is required. I could give you 5 usernames & passwords, 5 forms of biometrics, and have 5 different hardware tokens and you would still not know to any degree of certainty if I’m good for the loan.
For example: Two people are standing in front of you, one’s a stranger and one’s a close friend. You know [for the sake of this example] that they are both who they say they are, but do you feel equally comfortable lending both of them your car?