Bermuda pushes ahead with digital ID service providers framework consultations

Bermuda has issued a second consultation paper as the British Island territory advances efforts toward putting in place a new regulatory framework to guide the activities of Digital Identity Service Providers (DISPs).

Released on July 21 by the Bermuda Monetary Authority (BMA), comments on the paper are welcome till September 2.

The 23-page document provides details about how DISPs will be regulated; the different categories under which they will be placed; the determination, restriction and withdrawal of licenses, their scope of activities, outsourcing rules, issues around cybersecurity, compliance, governance and disciplinary measures, among many other aspects.

According to the BMA, the new framework, once approved and activated, will set the foundation for security, trust, innovation, and consumer protection in Bermuda’s digital identity ecosystem, and also align the country’s digital ID strategy with global standards and strengthen its position in digital finance.

The paper proposes a three-tiered structure to support different maturity levels of DISPs, which outlines licence class, purpose of the licence and the minimum capital required and application fee to be paid.

For instance, the paper indicates that a full licence (Class F) will be issued at a fee of $15,000 and only to qualified applicants with a minimum capital of $100,000. Class T licence for digital ID pilot and testing will be given at a fee of $1,000 and requires a minimum capital of $10,000, while Class M transitional licence will be obtained for $15,000 and will be issued to firms with a minimum capital of $100,000.

The release of this consultation paper comes after the BMA held a consultation meeting with different stakeholders in May to discuss the DISP regulatory framework idea.

Discussions during this first consultation, which followed a call for feedback on the first draft paper released in November last year, explored how best the country can establish a robust and flexible regulatory system for DISPs to help them function in a manner that encourages innovation, data protection and cybersecurity, and which aligns with global standards.

In the course of that meeting, several proposals were made by stakeholders and touched on different areas including on the scope of the framework, outsourcing and responsibilities, vetting responsibilities for issuing digital IDs, assurance, portability and interoperability.

The move to introduce a DISP regulatory framework is part of Bermuda’s digital transformation push reflected in the country’s IT Vision 2030 Strategy and the 2024-2027 Public Service Strategic Plan which aim to modernize service delivery and enhance user experience.

Article Topics

Bermuda  |  digital identity  |  identity proofing  |  Identity Service Providers (IDSP)  |  trust framework