Study finds digital IDs would yield economic good in three African nations

A new multinational study of African countries claims that digital IDs could save people millions and even hundreds of millions every year if applied to personal finance. South African residents could save $620 million, claims a new report.

The Tony Blair Institute for Global Change studied three African nations — Côte d’Ivoire, Rwanda and South Africa — to determine how certain marginalized groups would be impacted if they had digital IDs.

The study focuses on four marginalized subpopulations: the elderly, rural females, informal retailers and the urban unemployed.

Researchers looked at particular life situations including birth registration, medical insurance, social grants, education subsidies, vaccination and enrollment with banks and mobile money market accounts.

In Rwanda, they found that the four marginalized populations combined could save an estimated $9.7 million annually if digital ID were available for remotely opening bank and mobile money accounts, remote registration and receipt of social grants and remote registration for medical insurance. Elderly Rwandans, followed by informal retailers would see the greatest benefit from having digital IDs.

Residents of South Africa could save roughly $620 million if a digital ID were adopted for remotely opening bank and mobile money accounts, remote registration and receipt of social grants. The elderly, followed by rural women would see the greatest economic benefits if they had digital IDs, according to the study.

It also found that marginalized groups in Côte d’Ivoire could save $43.7 million if a digital ID is adopted to remotely register for education subsidies, bank and mobile money accounts, and births. The urban unemployed, followed by informal retailers would see the greatest economic impact.

The study insists on the importance of using digital IDs as a tool for inclusive development. It concludes with a number of recommended actions.

When it comes to use-case design, the study proposes that countries must weigh economic benefits at an individual/demographic level against a national level. National leaders should start with existing government and technical infrastructure.

The countries should also establish a public key infrastructure (PKI) and digital authentication mechanisms as foundations that can help scale and strengthen digital ID systems. Rwanda and Côte d’Ivoire lack a robust PKI, which means that existing digital cards function similarly to a paper credential in these countries.

And digital ID enrollment should be streamlined for registrants. Where possible, ID programs should be designed to help integrate fractured identity registry systems and expand internet coverage and digital literacy.

Article Topics

Africa  |  Côte d’Ivoire  |  digital ID  |  financial inclusion  |  Rwanda  |  South Africa  |  Tony Blair Institute