The introduction of a digital identity in South Africa had the potential to open new opportunities for the unemployed, vulnerable and/or elderly, according to the Digital Identity – A South African Journey report.
This report published this week was commissioned by payments partner BankservAfrica and conducted by PwC. It mapped out the South African Digital Identity outlining the country’s journey to date with the community of experts from the country’s leading financial services institutions, fintechs and the rest of the payments industry.
The digital identity would assist the unemployed, vulnerable and/or elderly to verify a secure identity and include them in the economy, which would in turn give them easier access to, for instance, employment, social benefits and government services.
Digital identity is a set of electronically captured and stored attributes and credentials that can uniquely identify a person. Identity attributes can be used to unlock access to banking, government benefits, health, education and other critical services.
BankservAfrica chief business officer Martin Grunewald said studies showed that over a billion people globally in low-and middle-income countries did not have any form of legally recognised identification.
“In South Africa, we can see the hard-hitting impact of limited access to essential services from government benefits to financial services, education and other critical services. By driving one conversation around developing a communitywide digital identity that citizens know and trust, we can build a more inclusive digital economy and create the change needed at a societal level,” said Grunewald.
The report came at a time when countries around the globe were fast-tracking their digital identity programmes for the digitalised future. BankservAfrica said South Africa was not far behind. The collective knowledge and insights by the digital community over the past months had generated the momentum needed to accelerate the design of a secure, trusted and interoperable digital identity for the country.
Grunewald said in the report, they explored the building blocks and the critical success factors needed to champion and mobilise a digital identity programme that was aligned to the South African Reserve Bank’s Vision 2025 for achieving the goal of financial inclusion and readied the country for the imminent Fourth Industrial Revolution.
The Department of Home Affairs (DHA) is the sole authority responsible for providing a means of identity to all South African citizens and residents. In addition, it manages the identity and supporting systems across both government and economic spheres.
According to the report, the potential benefits for the citizens included a simpler, more convenient Fica process that would save time, improved quality of service provision, reduced fraud and a better user experience. For the government it said it would reduce government expenditure due to improved administrative processes across its departments. It would also aid increased tax revenue collection and boost digital eCom, small, medium and micro enterprises, financial services and health.
More commercial benefits associated with this application for banks was an increased customer base. In addition, the processing of applications in a paperless form resulted in an efficient administrative process, which could save users and the service providers both time and money.
According to the report, a successful digital identity programme could help drive economic value by helping the government curb leakages in areas like social benefits. India was a prime example, with its government saving around $4.93 billion (R71bn) in the 2020 financial year. Non-economic value included the unlocking of major benefits for the people through inclusion, rights protection and transparency.
BUSINESS REPORT