Globally, governments and companies are seeking innovative ways to achieve financial inclusion. From banking the unbanked to helping vulnerable populations access digital banking, there is a pressing need to leverage technology and tools to provide equitable access to finance and essential services in an increasingly digital world.
A key component of financial inclusion is digital identity. According to the World Bank, approximately 850 million people worldwide lack an official ID, much less a digital one. Despite some progress, women in low-income countries are still 8 percentage points less likely to have an ID compared to men.
The same report estimates that 3.3 billion people globally, nearly a third of the world’s population, lack an official identity for online transactions. Most of these individuals live in the Global South, including countries in Africa, Latin America, and developing parts of Asia and the Middle East. Digital identity offers these regions a unique opportunity to bypass traditional identification methods, fostering rapid and widespread inclusion. Several success stories from Africa, Latin America, and East Asia highlight the potential for digital identity to drive significant progress.
However, for digital identity to be an effective and sustainable tool for inclusion, it must be supported by sound ethics, trust, and collaboration between government and industry.
A New Era for Digital Identity in the Global South
Historically, citizens in the Global South have faced challenges due to a lack of formal identity. Yet, many countries are making significant strides in changing this narrative. Maxine Most, a strategic innovator and founding Principal of Acuity Market Intelligence, noted the strengths she has observed in how these countries are applying digital identity. She highlighted the transformative impact of mobile phones, which provide accessible infrastructure at a low cost. Biometric identity adds a deeper layer of security to this mobile infrastructure, enabling individuals to claim and own their identities using their mobile devices.
Identity is a fundamental right, a tool for protection, and a gateway to accessing services. The World Bank reports that around one-third of adults without an ID experience difficulties accessing financial services, receiving government support, applying for jobs, or voting. Nearly 40 percent of adults without an ID face challenges obtaining a SIM card or mobile phone service, and about 25 percent struggle to receive medical care. Digital identity reduces costs and eliminates the need for travel, as people only need connectivity on their mobile phones.
Most echoed this sentiment, stating, “Whether you are in Africa, Latin America, or East Asia, everyone has a mobile phone. In many mobile-first economies, more people have access to phones than to laptops.” Mobile-first identification solutions, therefore, catalyze greater inclusion when accessing government and financial services.
Digital Identity Success Stories
For instance, in Morocco, 18.5 million social protection beneficiaries have registered in the new National Population Register, improving access to social assistance programs. In Nigeria, identity verification measures have been implemented to reduce government grant fraud, ensuring that grants reach those who need them most. The West Africa Unique Identification for Regional Integration and Inclusion (WURI) program has supported the registration of 1.3 million people in Benin, most of whom are women.
In East Asia, the Philippines Identification System (PhilSys) has achieved one of the world’s fastest rollouts of a new identity system, with over 80 million registrations, covering 90% of the target population. This initiative has facilitated greater access to government services and promoted financial inclusion. The success of M-Pesa in Kenya demonstrates the potential for 50 million people to receive and pay funds without a formal bank account. Similarly, in Morocco, over half of the beneficiaries of the Tayssir cash transfer program opted for digital payments shortly after implementation.
Identifying the Right Biometric Modality for the Global South
Among the various biometric options, face biometrics is the most widespread across the African continent due to its simplicity and familiarity. Most people are comfortable taking a selfie, which can be verified using 4D Liveness technology to authenticate against a government database. This remote face identification process is simple, secure, and low-friction, even in rural areas where smartphones may be shared among family members.
The Challenge of Digital Identity
Most emphasized that for digital identity to be successful in the Global South, it must overcome challenges related to creating a safe, reliable, secure, and private digital identity infrastructure, as well as operational issues such as corruption and insufficient regulatory support. While biometric identity is not a panacea, it opens up possibilities in developing nations with limited physical infrastructure.
Making the Quantum Leap
Embracing digital identity is not without challenges. Countries must focus on sound policies around digital identity and data, as well as citizen education. Most explained that regulatory compliance is critical to prevent data misuse and ensure privacy. For example, Cameroon recently issued a decree allowing non-banks to participate in government electronic payments, enabling mobile money payments to scale up. Nigeria has also passed multiple data protection laws, including a landmark law, to safeguard ID systems and data processing across the economy.
Educating citizens and lawmakers about the empowerment that comes from owning their identity is essential. Governments and companies can achieve this by partnering with organizations that approach biometric identity with integrity and purpose.
Necessity drives innovation. While citizens in the Global South have historically lacked formal and digital identification, this is changing rapidly. Countries in Africa, Latin America, and East Asia have embraced mobile technology due to poor fixed-line infrastructure, opening up new opportunities for inclusion. By partnering with biometric identity providers to build inclusive, comfortable, and secure solutions, the future looks promising.
About the author:
Lance Fanaroff is a co-founder of iiDENTIFii, a South Africa-based remote biometric digital authentication and automated onboarding technology platform.
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