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Biometrics and financial inclusion: A roadmap for implementing biometric identity systems in sub-Saharan Africa

The World Bank (2017) estimates that 1.1 billion people live without proof of identity. Nearly 50% of these people live in sub-Saharan Africa, where 454 million individuals are excluded from formal identify systems. In Nigeria,  78% of the population or 149 million individuals cannot prove their identity. Lack of identity documentation varies in its severity as a barrier to exclusion depending on the country, but overall indicates a significant problem for financial services. For example, in Angola, 41% of financially excluded adults cited a lack of documents as the reason for being financially excluded, while in South Africa and Nigeria this figure was 14% and 12% respectively.

A a number of studies have explored the potential of biometrics in addressing identity challenges, but the adoption and use of biometrics in Africa have been slow and uncoordinated at best. This note from Cenfri  seeks to understand the “biometrics journey” of countries and financial service providers (FSPs) and to help them select and adopt biometric approaches that have a lasting impact on financial inclusion, financial integrity and broader national development objectives. It discusses the concept of identity and the link between robust identity systems and financial inclusion, highlighting the role that lack of identity plays in facilitating financial exclusion in SSA. It defines biometrics, unpacking the role of biometrics in the identity space and how biometrics can be a strong identifier. It looks at the use cases for biometrics as well as the barriers to the successful implementation of biometric identity schemes in SSA. Lastly, it presents a roadmap for implementing biometric identity in Africa to guide regulators, industry players and donors on how to best go about the process.

 

Cenfri
Cenfri is an independent, not-for-profit think-tank. As recognised thought leaders on matters relating to financial-sector development in emerging markets, we generate deep insights and solve complex development problems.

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