Catalyzing Good ID in Africa’s digital economy: Why we invested in Smart Africa

By Magdi Amin and Eric McCarthy, Omidyar Network

An ability to prove one’s identity is central to the empowerment of individuals in the modern state. Access to basic human rights and essential services depend on it. Such rights and services include social protection for vulnerable populations including children, education, healthcare, and travel. Certain forms of ID help enable access to finance and trade, and are therefore central to economic inclusion. This is especially relevant for African women, for whom the lack of identification is a severe barrier to financial services.

To help close the ID gap and accelerate economic and social inclusion, many governments are turning to the digital revolution for answers. “Smart Africa” is a bold and innovative initiative, led by African heads of state, to accelerate sustainable socio-economic development on the continent, ushering Africa into a knowledge economy through affordable access to broadband and usage of information and communications technologies. The alliance is made up 27 countries and represents more than 600 million people.

Earlier this year, the Smart Africa board recognized digital ID as a crucial element in the transformation of Africa into a single, common digital market. They have witnessed digital versions of ID to be an effective tool for targeting social services and social safety nets. For the private sector, this can mean dramatic reduction in the cost of onboarding customers and reducing fraud. According to the McKinsey Global Institute, digital identity programs can also unlock value equivalent to 3 to 13 percent of GDP in 2030 with more than 50 percent of that economic value being experienced by individuals.

While there are tangible benefits to digital IDs, there are also substantial risks. The establishment of digital ID programs require collection of information on individuals, which can represent a shift in power to the state. In absence of checks and balances, this power may be used not to empower individuals but to monitor or control them, as well as to selectively include or exclude segments of the population from participation in the benefits of the state.

At Omidyar Network, we believe that all identity should be Good ID — a human-centered approach in which ID programs are developed transparently; are designed for the trust, inclusion and empowerment of people; and provide for the privacy and security of people’s personal data. Omidyar Network looks to partner with institutions who share this vision and helps strengthen the capacity of African organizations, including government, civil society, and the private sector, to advance Good ID in practice.

We have invested in Smart Africa to support the development of its blueprint for good digital identity in Africa. With our support, Smart Africa will:

• Position digital identity within the broader context of the digital economy so that both develop in harmony and in ways that empower individuals;
• Increase African leaders’ awareness and understanding of the design choices that lead to Good ID; and
• Partner with African nations on the implementation of Good ID programs, including policy, technology, and practice.

In 2020, several government members of Smart Africa will lead this work through pilots designed to give others a blueprint for implementing their own good digital ID programs.

Our investment in Smart Africa builds on other key partnerships on the continent, including the capacity-building work of the United Nations Economic Commission for Africa (UNECA), data protection workstream within ID4Africa, research by institutions such as Strathmore University, and advocacy by civil society groups such as Lawyers Hub. In fact, UNECA and Smart Africa are already working with the African Union on a policy to support interoperable digital identity as part of the African Union’s Digital Transformation Strategy 2020–2030.

It is our hope that the combination of Pan-African collaboration, harmonization, and ethical technology, facilitated by Smart Africa, could allow African governments, businesses, and entrepreneurs to develop new services, accelerate financial inclusion for millions of residents, and create powerful opportunities for the region’s economy — backed by Good ID.