Biometrics and financial inclusion · fingerprints, facial features, or the sound of their voice....
Transcript of Biometrics and financial inclusion · fingerprints, facial features, or the sound of their voice....
Biometrics and financial inclusion
Brownbag session | 6 July 2018
Matthew Ferreira
Problem statement
The World Bank (2017) estimates
that 1.1 billion people live without
proof of identity
2 | Source:2 | Source:
“ ”
Problem statement
3 | Findex (2017)
Financially excluded due to lack of documentation
43%
17% 18%
30%
42%
24%
27%
30%28%
11%
21%22%
38%
30%
33%
50%
36%
26%
32%
26%
32%
18%
10%
16%
29%
22%
26%
30%
43%
28%
35%
49%
0%
10%
20%
30%
40%
50%
60%
Ben
in
Bo
tsw
ana
Bu
rkin
a Fa
so
Cam
ero
on
Ce
ntr
al A
fric
an R
epu
blic
Ch
ad
DR
Co
ngo
Co
ngo
, Re
p.
Co
te d
'Ivo
ire
Eth
iop
ia
Gab
on
Gh
ana
Gu
inea
Ken
ya
Leso
tho
Mad
agas
car
Mal
awi
Mal
i
Mau
riti
us
Nam
ibia
Nig
er
Nig
eria
Rw
and
a
Sen
ega
l
Sie
rra
Leo
ne
Sou
th A
fric
a
Sou
th S
ud
an
Tan
zan
ia
Togo
Uga
nd
a
Zam
bia
Zim
bab
we
Pe
rce
nta
ge o
f ad
ult
s w
ith
ou
t an
acc
ou
nt
at a
fin
anci
al in
stit
uti
on
Structure of presentation
• Identity
• What are biometrics and how do they fit into identity
• Use cases for biometrics
• Barriers
• Recommendations
4
Identity
• Biometrics• Identity document
• Proof of address
• Bank card
What is identity?
• Password
• Pin
Something a person knows
Something a person hasSomething a
person is
Identity is the collection of attributes about an individual or legal entity that can be distinguished as unique to that person or entity.
Two-factor identity
Three-factor identity
6 | Source:
What is digital identity
• When some or all of these attributes are captured and stored digitally the composite resulting is known as a digital identity
Example of digital identity: Identity card with chip storing information; identity information stored on a national database; Facebook
7 | Source:7 | Source:
Biometrics
What are biometrics?
• Identification attributes based on physical or behavioural traits
• Physical traits refer to actual physiological aspects of a person, such as their fingerprints, facial features, or the sound of their voice.
• Behavioural traits refer to distinctive behaviours, habits, and micro-habits that distinguish a person
• These biometrics traits can be used as part of a digital identity
9 | Source:
How are biometric data captured and stored?
A biometric template, or profile, is a
statistical analysis of the measurement
resulting in a specific reduced data set
that can be used to represent the
physical characteristics or features of
an individual
10 | Consult Hyperion (2017)
“”
How are they used?
Identification Verification
Asks the question: who is this person?
Asks the question: is this person who they say they are?
11 | Source:
Use cases
Use cases: What is so great about biometrics?
Robust identifier
Inherent to the consumer
• Can’t lose your biometric (or can you?)
• Identity theft more difficult
• More accurate identifier than paper
• More protection from fraud
• Easy to store and manage
13 | Source:
Use cases
• How do biometrics stop fraud?
Biometrics match
another identity
Provide biometrics
Try to register again under
different name
Register for grant
Biometrics don’t match
Hospital scans fingerprint
Use card at hospital
Steal identity card
14 | Source:
Use cases: the banking and financial services sector
• Being able to confidently identify your customers
enhances understanding of consumer risk profiles
• More convenient for consumer
• Safer for consumer
• If linked to a national biometrics identity
database, can reduce onboarding cost and
increase efficiency through e-KYC
Aadhaar India
15 | Source:
Barriers
Barriers
Lack of harmonisation between departments limits use casesHigh capital cost
Failure to follow through and complete projectsLimited political will
Slow or absent network coverage limits usability Underdeveloped infrastructure
Staff not trained or skilled enough to use devicesLack of training and skills
Citizens are concerned for their privacyPrivacy and trust
17 | Source:
Recommendations
Siloed Biometric initiatives can be overcome by an interoperable and harmonized approach
Content
Robust, affordable and harmonized
national Biometric identity resource
Voting registration biometric
Government service/donor
programme biometric
Health insurance
sector biometric
Financial Service sector
biometric
Accessing original biometric data via
source code
Standardised templates
The goal
The solution
The current situation
This may be achieved through the harmonization and effective leveraging of components for improved implementation
Further recommendations
• Develop data protection and privacy legislation
• Conduct business feasibility studies to assess which biometrics options to use
• Ongoing training and mentoring of staff
20 | Source:
About CenfriThe Centre for Financial Regulation & Inclusion (Cenfri) is a global think tank and non-profit enterprise that bridges the gap between insights and impact in the financial sector. Cenfri’s people are driven by a vision of a world where all people live their financial lives optimally to enhance welfare and grow the economy. Its core focus is on generating insights that can inform policymakers, marketplayers and donors seeking to unlock development outcomes through inclusive financial services and the financial sector more broadly.
Thank you