Back In The Day, if somewhere like a car hire agency wanted to record proof of identity they'd photocopy your driver's license on paper, and store it in a filing cabinet. The computer record of a customer's account would just say "driving license checked, on file at branch #1234"
Security-wise this comes with obvious downsides - but as protection against cyberattack, it's pretty much the gold standard.
Security-wise this comes with obvious downsides - but as protection against cyberattack, it's pretty much the gold standard.