Government agency employs biometrics and a blockchain to register and track digital IDs
Sierra Leone’s National Civil Registry Agency is piloting an electronic identification system underpinned by both biometrics and blockchain technologies. In a blog post, the government said that registered citizens that unlock their digital ID with their thumbprint will then be able to grant access to their biodata to any institution connected to the digital ID platform. Once deployed nationally, public sector organisations plan to use the digital ID to provide social services, the blog post added.
The new system uses an “encrypted distributed data storage system” or blockchain to ensure that the electronic IDs will be decentralised, transferable, and where necessary, interoperable.
The government is piloting the new system with the Bank of Sierra Leone, supported by the United Nations Development Programme and multinational lender Kiva, to help banks meet Know Your Customer (KYC) requirements. Citing figures from the World Bank, the blog post said just 12.4 per cent of adults in Sierra Leone have a bank account, while 19.8% have access to formal financial services, including mobile money. “The new platform will help about 20 per cent of financially excluded adults who are unable to access financial services because they lack the correct documentation to prove their identity,” said Dr. Patricia Laverley, Deputy Minister of Finance.
For banks worldwide, meeting increasingly stringent KYC processes can be a burden. The potential cost of losing just a few percent of new customers to complex manual KYC processes is now as much as €10 million a year for a typical European bank serving 10 million customers, according to new research from Mitek and Consult Hyperion. After five years, the cumulative lost opportunity could cost banks in excess of €150 million, the research added.
For more information, please see the blog post from Sierra Leone’s Directorate of Science, Technology and Innovation (DSTI) and the Mitek and Consult Hyperion report: The Cost of Compliance and How to Reduce It.