The growing global market for Civil ID on the path to digitization

digital identity biometric registration

Civil ID programs are identity management applications used by governments to verify a citizen and establish a link of trust, typically at large-scale. A civil ID (sometimes in the form of a national ID or eID) is one means of identifying citizens, permanent residents and temporary residents for the purposes of work, taxation, government benefits, health care and other government related functions. This could be for issuing official documents, managing borders, registering voters or employment background checks. Another subset of civil ID is the biometric epassport, a travel document with a computer chip.

Civil ID shipments are forecast to have grown from $618.8 million in 2018 to $732.7 million in 2023.

Where civil IDs are used, the overwhelmingly dominant industry involved is government. Types of civil ID commonly issued include driver licenses, passports, health-related documents and national ID cards.

There is some desire by national governments to combine the areas, producing an ID that incorporates a COVID-19 status statement. The document would be digital or physical, and would be accepted everywhere within nations and across borders. It is an ambitious goal given the politics of the major developed and developing economies.

Regional considerations:

It is no overstatement to say that if U.S. Social Security cards were introduced today, they would be rejected by a huge minority — at least. Opposition to government COVID tracking, which is a central tactic in minimizing disease spread, has stymied even local-level success.

That hasn’t stopped federal and some state efforts to start programs.

As recently as November 2020, a U.S. congressman was extolling the benefits of a national digital ID. Developments in health care including the opioid crisis and the coronavirus make the case for national authentication, according to Rep. Bill Foster.

Of course, the fact that an estimated $16 billion was stolen from consumers in the United States in 2018 would seem to be sentiment-swaying. Too many in the country fear ill-defined crimes that a government could perpetrate if it gets more information about its citizens.

One the other hand, private employers, especially security-sensitive sectors like defense, have started to demand the IDs before performing background checks. They are being used as health insurance cards in some nations.

Clearly, not all proponents of national eIDs are pro-dictatorship, but all dictators control their subjects by identifying them.

China has a comprehensive civil ID program. Last year, it began trials on a civil ID function that would track owners’ online history. But the country remains a largely closed, state-funded ecosystem, making it difficult to win a significant market share. With a top-down economy, China’s national leaders choose winners and losers.

Russian politicians, meanwhile, view with awe the progress its neighbor has achieved with standardized civil IDs (and surveillance). Like China, Russia historically has suffered from governmental disfunction and xenophobia, leading regime after regime to seek the greatest control over its people’s actions, including their travel. But dominated by oligarchs, any strategic new technology or procedures will be result in artificially low outsider industry participation.

India’s Aadhaar national ID program is the most advanced such biometric identifier among democracies and developing economies. It continues to be more deeply integrated into the nation’s government, business and cultural spheres.

Aadhaar authentication is one of the methods used by people in India for registration with the country’s vaccine management system. Financial transactions and on-boarding are already availability. Biometric features including de-duplication of bank accounts, authenticated voting and annual certification for pension benefits show how Aadhaar is being woven into individual lives.

Being a democracy, complaints about and protests of Aadhaar — including loss of privacy, data security concern and government abuse — are more visible than in China and Russia. Balancing the speed and comprehensive scope of feature rollouts has created hurdles for the national government.

But being a comparatively open economy, India allows more foreign competition and influence in the biometric civil ID sector.

The European Union cuts a unique figure in this arena. It is a coalition of European countries with common economic interests — the European single market. Physical borders between the members years ago were softened in order to promote greater economic integration.

Leaders of the EU and those of many of its constituent nations are pushing for a unified eID, preferably one that would involve driver and health certificates. Fourteen of 27 members operate digital civil IDs.

In mid-2020, the EU signed off on new biometric standards for physical IDs, which today are too easy to forge. Those cards are being phased out in favor of a card with a contactless chip that holds the owner’s biometric data.

The EU is a democratic club, and its economies are as open as any one developed nation’s economy, it suffers cultural ills that run counter to the ideas of a unified eID program.

Nigeria is in the process of scaling registration in its National Identity Number system, and Kenya is working on its Huduma Namba, in two prominent examples of a common approach in Africa of establishing overarching foundational civil IDs.

Current trends:

Throughout the world, though primarily in the world’s largest economies, the digitization of driver’s licenses and passports as mobile device-based IDs are an emerging trend.

ISO has standards in development for mobile driver’s licenses, and digital travel credential schemes established by world bodies have reached the trial stage.

Nations with emerging economies, meanwhile, continue to work towards registering their populations for civil IDs to bring them into the formal economy and increase the reach of their programs and services.

Major players include:

Major players in this market include: Acuant, Aratek, CardLogix, CMI Tech, Fujitsu, Giesecke & Devrient, HID Global, HSB Identification, Idemia, Integrated Biometrics, NEC, Regula, SecuGen, Thales, VaultID, and Zetes.

Posted March 25, 2021

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