Page 71 - ITU-T Focus Group Digital Financial Services – Technology, innovation and competition

ITU-T Focus Group Digital Financial Services
Technology, Innovation and Competition

A.3.1 Applications within DFS

The usage of state-issued eID cards ranges from limited government applications to broader support for
commercial services. Applications within DFS are limited by how many citizens are registered and the
accessibility of the middleware.

For example, where a national eID card scheme may potentially ease the registration process for a mobile
money provider, the necessity to purchase an additional card reader, for every agent, in order to gain that
benefit could significantly impact an already tightly-margined business model.

In order to present a viable proposition, the number of individuals registered with the eID scheme needs to be
sufficient, such that the benefit of integration (for DFS providers) is significant to offset what would otherwise
be expenses incurred in the registration and storage of KYC documentation.

However, the presence of scale alone does not define a capability for widespread application. The security
surrounding the storage and communication of personal data bythird party IDPs is a major concern for DFS

operators. Any breach within a digital identity service which is integrated into DFS could ultimately undermine
the security of the DFS provider service and run the risk of funding criminal and terrorist objectives.
National schemes with market dominance are also subject to certain competition concerns. One of the principle
drivers behind DFS is inclusion. In Pakistan, it was necessary to register for the NADRA scheme in order to
access utilities such as gas and electricity . Although the scheme employed mobile vans to travel to rural areas
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in order to register people, the lack of choice for citizens puts a huge amount of leverage in the hands of the
enumerators responsible for registration.

A.3.2 Summary of state-issued eID systems

State-issued eID architecture
Description Typically involves the control and access of personal data through a consumer-issued authen-
tication token (usually on a smartcard or mobile device) and a service provider accessible
middleware.

Strengths • Enables foundational ID that can be used for DFS registration;
• Uses high quality data during identification activities.

Weaknesses • Requires middleware access for service providers;
• Can create a barrier to adoption of DFS for low income demographics;

• Application within DFS is dependent on scale of the service.
Examples NADRA (Pakistan), Aadhaar (India), NIMC (Nigeria)

A.4 Brokered IDP architecture

The brokered IDP model involves a number of IDPs undertaking identification and authentication services
and sharing data with service providers via a central hub. Once an identity is asserted, the data to be shared
is standardised and routed to the appropriate service provider via the hub. Figure 10 illustrates the brokered
IDP model architecture.

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