Adoption and acceptance of Digital Identity

Physical  ID vs Digital ID

While the world is still more familiar with physical IDs (which may then be linked to online government records), it continues to be inadequate today, as they can be easily manipulated or purchased illegally. IDENTITY –still on a piece of paper? This needs to be rethought, in a world where hard copies are going obsolete we need digital identity. Hence, governments of different countries have taken up new projects to build a 100% secure and digitized identity by levelling up their existing systems. This step by governments of different countries to build a national DIGITAL ID system is certainly the first step in building a digitally inclusive society.

As per the report by Mckinsey, in the emerging economies, it found that basic digital ID alone could unlock upto 50- 70 % of the full economic potential, assuming adoption rates of about 70 %. The Philippines and Thailand are among those beginning to see significant progress as they lay the infrastructural and regulatory foundations for digital IDs. Others, such as Singapore and Indonesia, are in the midst of rolling out facial verification in their national identity scheme.

In Indonesia, this facial recognition technology taps on the country’s e-KTP database to improve social aid disbursement. It allows citizens to claim social assistance simply by visiting a merchant with facial scanning technology to verify their identity.

As the vaccination drive is out like a light, we have begun to notice the importance of a national digital ID to the fullest for example in India amid a surge in coronavirus cases, authorities are testing a facial recognition system based on the Aadhaar ID for authentication in the eastern state of Jharkhand, and plan to roll it out nationwide, a senior official said last week.

“Aadhaar-based facial recognition system could soon replace biometric fingerprint or iris scan machines at Covid-19 vaccination centres across the country in order to avoid infections,” R.S. Sharma, chief of the National Health Authority, was quoted as telling an online publication.

The French government on 14th March 2021 has launched digital identity cards equipped with QR codes and fingerprints. It also has an electronic chip that acts as an all-access key. According to French Citizenship Minister Marlène Schiappa, “The identity card as you know it, as the French know it at the moment, it will gradually be replaced by a new object, the one we have been able to discover, more practical, new, which has a format more suitable for the pocket or the wallet. It is also an object that is more protective of our rights, and more secure, which will take its place in our daily lives.”

Why is the world moving towards Digital ID’s?

This simple feature has profound implications for every country’s digital transformation journey and its development goals. More than a billion people around the world have no formal way of proving who they are. This can be a quicker way for their inclusion. Almost one billion people in the world lack a legally recognized identity. This means that they are denied access to government aid, health care, financial perks, job opportunities, obtaining property rights, and registering a business. Digital ID can help remove these barriers towards basic needs. It can also help the rest of the world’s dwellers, who hold some form of ID but have limited access to online services or are transacting online but find it difficult to keep track of their transactions securely and efficiently.

Digital ID could meaningfully reduce those risks by minimizing the opportunity for manual error or breaches of conduct. For example, for conventional ID programs, reconciliation of data between databases may be impossible or error-prone, while digital ID programs can more readily integrate data sources and implement data quality checks and controls. High-assurance digital ID programs also reduce the risk of forgery and unauthorized use, which are relatively easier with conventional IDs, like driver’s licenses and passports.

The role of national digital identities has risen in prominence over the past year. There is much to be gained for businesses in Indonesia that want to tap into national digital ID systems, including a better user experience, streamlined operations, heightened security, reduced fraud, and cost-efficiency.

Should businesses incorporate facial biometric ID verification in their processes too?

Several points need to be considered by leaders of businesses before incorporating this into their processes such as: Which identity verification method should be implemented for their businesses? for example: For low-risk businesses such as e-commerce applications for low-value goods, one doesn’t need a robust identity verification as the risk involved is very less. At that time low touch risk scoring methods are enough to verify the onboarding customers. On the contrary banks and other FI’s need a completely secure onboarding method.

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