In 2022, the National Identity Program initiated the enrollment process for the Fayda ID, which serves as Ethiopia’s primary identification document for confirming one’s identity. So far, the program has successfully registered slightly over 1.4 million Ethiopians for the Fayda ID.
The Kebele ID, which primarily identifies a person’s place of residence, currently stands as the most widely accepted form of identification. According to estimates, it is believed that between 90% and 95% of adults currently use the Kebele ID. This identification card is used in conjunction with other functional identification documents like driver’s licenses and international passports to authenticate a person’s identity.
Ethiopia’s new digital ID legislation is poised to lay the foundation for a strong and modern registration system. The proposed bill encompasses essential elements such as registration processes, authentication services, the organizational structure, data security measures, safeguards for privacy, and the legal ramifications of any breaches. This initiative is expected to usher in a modernized identification system in Ethiopia while also fostering inclusivity.
Neighboring Kenya is also in the process of implementing a digital identity system for its citizens. To illustrate, the imminent launch, scheduled for this month, will incorporate a unique personal identifiers (UPI) system, incorporating cutting-edge security elements like iris and facial biometrics, along with fingerprint identification, mirroring the features found in the current identity documents. These new IDs are intended to supplant the unsuccessful Huduma Namba initiative introduced by the previous administration in 2018.
In the forthcoming fiscal year, the initial objective is to integrate all individuals in the financial sector into a robust digital identification system. This endeavor is geared towards establishing a safer and more inclusive financial environment for all stakeholders. In accordance with the official statement from the initiative, this digital ID will function as the “primary Bank ID” and will hold legal recognition across all financial institutions.
The National Bank of Ethiopia has unveiled a collaborative initiative in partnership with the National ID Program, aiming to harness the potential of the nation’s digital identification system, known as Fayda. This initiative signifies a pivotal shift in how financial institutions in Ethiopia verify the identity of their customers, with Fayda set to become the primary means of identification for all financial transactions, as reported by Biometric Update. The overarching goal of this ambitious endeavor is to onboard all banking customers onto the Fayda digital ID platform by the year 2024, aligning with the government’s overarching agenda to foster greater financial inclusion among its citizens.
Fayda, which translates to “value” in Swahili, Amharic, and Arabic, is poised to revolutionize the process of verifying individuals’ identities for banking purposes, ushering in a more efficient, secure, and privacy-conscious system. to be a transformative force in the realm of digital identification.
Crucially, the Fayda program enjoys the backing and support of the World Bank and will leverage the Modular Open-Source Identity Platform (MOSIP). MOSIP, an open-source software, serves as a standardized framework for constructing national ID systems. Originating in India at the International Institute of Information Technology-Bangalore, MOSIP has garnered international recognition and support from influential organizations such as the Bill & Melinda Gates Foundation, Omidyar Network, and Tata Trusts.
Given the ongoing political and security crisis in the country, many had feared the technology would be used by the government to profile individuals based on sectarian grounds. But the government claims ethnicity or religion will not feature in the national digital ID system. The authorities say the ID includes the individual’s name, gender, birth date, iris scan, fingerprints, along with a unique identifier code.
The World Bank’s endorsement of digital ID initiatives stems from its recognition of the vast potential they hold, especially in empowering vulnerable populations. Digital ID systems play a pivotal role in enabling individuals to assert their identities, thereby facilitating access to critical services like education, healthcare, social protection, and financial services. Governments can also capitalize on these systems to optimize service delivery, reduce costs, and combat fraudulent activities.
The compulsory adoption of digital ID for banking operations in Ethiopia represents a momentous leap forward in the nation’s drive for financial inclusion. Through the Fayda system and the technology underpinning it, which is based on MOSIP, Ethiopia is joining a global movement aimed at establishing secure, efficient, and inclusive digital identification systems. This transition carries the potential to revolutionize Ethiopia’s financial sector and empower its populace to access a diverse array of services and opportunities.