Digital identity
And then there is digital identity technology. Even before the pandemic
accelerated the transition to a more connected world, digital identity was
seen as one of the most significant technology trends, especially for the
developing world. According to the World Bank Group, 1.1 billion people
worldwide lack documentation or verifiable credentials to prove their
identity. For years, countries have tried to replicate the success of
India’s Aadhaar digital ID and the e-Estonia national identity system. The
expected benefits include increased government transparency (regarding the
budget and elections, for example), easier access to government assistance,
and expanded access to basic financial services, especially for displaced
or undocumented people.
Over the years, adoption has been slowed by numerous challenges, ranging
from ineffective national coordination to limited digital literacy.
Cybersecurity issues, data privacy concerns, and mistrust of technologies
provided by government have also delayed the deployment of digital ID in
many countries. These unresolved challenges have often relegated digital
identity programs to the back burner.
But the COVID-19 pandemic has forced governments to rapidly overcome or
sidestep these issues to deliver urgently needed financial assistance and
other forms of support to the most vulnerable citizens. The time is ripe:
the benefits of deploying a national digital ID, including its potential
for reliable databases with socioeconomic indicators, now outweigh some of
the concerns.
The underlying technologies are now quite mature. For example, security and
encryption algorithms, such as two-factor authentication and asymmetric
encryption, improve the integrity and privacy of data. Artificial
intelligence, machine learning, and biometric sensors built into mobile
devices can significantly reduce fraud. They can also simplify users’
experience by scanning their fingerprints, face, or voice. Moreover,
digital ID open-source software, open application-programming-interface (API)-based solutions, and international standards
have recently emerged, reducing the implementation costs of national
digital ID programs.
Technology providers are already one step ahead, and a new generation of ID
solutions is rapidly emerging. Early tests of blockchain-based identities
are gaining momentum in several countries, including in Estonia. This
potentially groundbreaking technology could shift the control and ownership
of data from governments to citizens while preserving governments’
authority to issue and validate identity and related services.
But the risks and potential for misuse of digital identity remain real and
require the careful, continuous attention of policymakers and regulators.
The pandemic certainly has highlighted the benefits of digital ID, but it
has also exposed the dangers to privacy when combined with other
technologies, such as tracing applications. Regardless of which technology
is used, successful digital ID systems must be secure, inclusive, and
interoperable to deliver their transformative impact for the billions of
people without IDs.
