Digital IDs in Africa: Will Blockchain Play A Role?
May 25, 2024
Key Insights
- Blockchain-enabled digital IDs in Africa will improve access to essential services, particularly for marginalized populations, by providing secure and verifiable identification.
- Successful implementation of blockchain-based digital IDs requires a collaborative educational approach to inform and engage decision-makers and target users.
- Multiple blockchain-based digital ID projects are active across Africa, including initiatives in South Africa, Uganda, Rwanda, Sierra Leone, Ethiopia, Ghana, Kenya, Mozambique, and Nigeria.
Primer
The World Economic Forum (WEF) expects that by 2030, the majority of the world’s population will have self-sovereign digital identification systems.
We can both agree that blockchain is bound to play a crucial role.
Implementing blockchain-enabled digital IDs in Africa will help millions access essential services.
Blockchain technology gives a digital proof of claims, particularly when accessing resources or exercising rights.
Mobile technology has provided the premise for digital IDs by allowing transactions, savings, and credit access to those lacking traditional identification documents.
Blockchain chips in to bridge the identity gap by providing safe identification to marginalized populations. Individuals can use these IDs to access bank accounts, loans, and conduct transactions.
However, there is a need for a widespread collaborative educational approach to foster understanding among decision-makers and target users.
Blockchain-Based Digital ID Projects in Africa
Already, blockchain is powering some projects in Africa.
- South Africa’s Trustlab has collaborated with the UN’s International Organization for Migration to develop a blockchain-based digital identity system for refugees.
- Sovrin is a global utility for self-sovereign identification, which no one controls but the natural owner and cannot be taken away, stripped of privacy, or influenced by inappropriate terms of service.
- FlexID provides a blockchain-based identity and access management solution.
- Yoma Project is a digital marketplace that uses blockchain to verify African youth’s achievements and creates a digital CV to enhance their employability.
- The Kiva Protocol, launched in 2018, seeks to address banking sector issues by offering an open-source platform for sharing ID and financial data.
- Earth.Fund offers secure private data sharing, portable digital identity management, and user verification and authentication.
The emphasis is on providing secure, self-sovereign identity solutions that enhance privacy, accessibility, and user control over personal data.
Digital ID Projects in Africa by Country
Digital identity projects across Africa are developing digital identity systems as outlined below:
- In Uganda, Mercy Corps Ventures and Coinbase established a digital ID pilot project in 2022 to assist 35,000 refugees. It aimed to provide an accurate means of identification and allow crypto transfers for aid distribution.
- The Rwandan government has partnered with WiseKey and Microsoft Azure to provide digital authentication, safe transactions, and legally binding signatures.
- Sierra Leone, in partnership with the United Nations, is developing a blockchain-based digital ID system to digitize identity records and issue unique national identity numbers, aiming to launch by 2020.
- In 2019, the Benin government introduced biometric cards through the RAVIP campaign and distributed around 350,000 ID cards to marginalized areas by year-end.
- In 2022, Ethiopia’s NDIP began enrolling citizens for the Fayda ID. By October 2023, over 1.4 million were registered, and by July, the ID became mandatory for financial transactions and later integrated into healthcare and civil service. Besides, the National Bank of Ethiopia aims to enroll all bank customers by 2024.
- In 2017, Ghana began overhauling the Ghana Card to centralize databases, enhance borrower credibility, and reduce interest rates. Since August 2023, all newborns receive a lifelong Ghana Card number and Birth Certificate ID.
- Kenya’s National Integrated Identity Management System (NIIMS), started in 2019, aims to create a unified digital ID for public service access. By December 2023, Kenyans will use iris and fingerprint scans with the Maisha Namba, replacing the suspended Huduma Namba. The Maisha Card will include a microprocessor with encrypted data and a virtual Maisha Digital ID. This comes as a surprise, alluding to the suspension of the WorldCoin protocol for digital ID security concerns.
- Mozambique is developing a digital identity system that aligns with its Digital Governance and Economy Project (EDGE).
- Since 2007, Nigeria’s National Identity Management Commission (NIMC) manages the National Identity Database and issues Unique National Identification Numbers (NINs) and General Multi-Purpose Cards (GMPCs). Recently, the 2020 ID4D initiative, supported by the World Bank, aims to integrate ID systems to promote gender inclusion and strengthen the legal framework.
- Launched in 2014, Uganda’s National ID Program, part of the National Security Information System (NSIS) , uses biometrics to verify refugees’ identities with support from UNHCR and WFP.
These projects focus on enhancing identification systems through advanced technology, such as biometrics and blockchain, to improve service access and security for citizens and marginalized groups.
Challenges Facing Digital IDs in Africa
The general consensus about digital ID implementation in Africa is the enormous potential for promoting inclusivity.
However, it grapples with unique challenges.
Amidst the lack of comprehensive personal data protection laws in some countries, poor data protection increases the risk of identity theft and misuse. Besides, exclusionary digital ID systems hinder leave marginalized populations without access. Challenges faced include poor network coverage, travel distances, and legal concerns. As a result, many digital ID cards are likely to remain uncollected. Thus, regulatory sandboxing is recommended to allow companies to pilot blockchain digital IDs under relaxed regulations.
This offers an innovation-friendly path between ex-post and ex-ante regulation.
The full potential of blockchain-based digital identity systems in Africa lies in their ability to enhance inclusivity and security.
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