User-centric digital ID, biometric KYC policy model proposed by financial inclusion group
The Alliance for Global Financial Inclusion (AFI-Global), a policy leadership alliance led by member central banks and financial regulatory institutions, has built a policy model to act as a guide for developing or reviewing policies and regulations for digital ID, remote KYC and the biometrics that back them.
With digital identity, biometrics and accessibility at its core, the ‘Policy Model for Digital Identity and Electronic Know Your Customer (E-KYC)’ sets out a series of principles to be considered, which includes frameworks, infrastructure and interoperability, aiming to enable countries to build robust, sustainable systems that will contribute to financial and data integrity.
AFI’s model recommends establishing clear policies on the collection of biometric information, its storage, and usage. Governments should determine what biometrics are most useful for the system being developed and keep in mind the principles of proportionality and utility. Furthermore, collection of biometric data should be kept to a minimum. The model also highlights maximizing flexibility within the scope of updating biometric information that is subject to change due to age, occupation, physical or medical conditions (including amendments and deletion of such data).
The organization also emphasizes the need to store biometric and demographic data separately, and be ready to deliver last-mile services for biometric enrollment.
Many countries have been upgrading and working on developing national digital ID systems for better public services, healthcare, inclusion and cost savings, among numerous motivations. The AFI policy model highlights the importance of keeping the approach to the development of such systems user-centric, building on the acknowledgement of digital ID being a key part of an overall inclusive fintech policy framework.
By ensuring good user-centric systems, data control is in the hands of the user, while proportionality helps to sort collection of only most relevant data. The AFI document will be reviewed regularly to adjust to developments in the field.
The U.S. National Institute of Standards and Technology also recently put forward a proposed set of guidelines to define the concepts of digital identity, best practices and suggestion of mandatory requirements at the federal level, of which, could make digital identity more convenient with support for passwordless authentication and remote identity proofing.