Mastercard’s Mission to Deliver Digital Identities to Africa - Identity Review | Global Tech Think Tank - Identity Review | Global Tech Think Tank

Starting this summer, Mastercard and fintech partner Paycode will onboard the biometrics of 30 million individuals from remote areas of Africa to provide them with digital identities and bank accounts through smartcards.

According to a study by the World Bank Group, an estimated 57% of Sub Saharan Africa’s population remains financially excluded, and 60% of the continent has no internet connectivity. Mastercard aims to provide basic financial services to underserved populations in Africa by partnering with Paycode to issue smartcards secured by biometric access at both online and offline locations over the next three years.   

This venture is evidence of an emerging market of digital identification curated by private institutions. 

“Adding inclusive ID functionality to Paycode biometric smart cards helps reach those currently excluded from critical government programs and ensures we are addressing basic financial needs of a dispersed population,” said Ricardo Pareja, SVP, Sales & Market Development, H&D for Mastercard in a press release. If fully adopted, Mastercard and Paycode’s solution will be the primary guarantor of ID for 30% of the African population who remain without a form of identification. This, too, raises the question on consent for many participants who may not be aware of what they are signing up for. 

An Identity Crisis

Of late, the inclusion of biometric data in banking services has garnered attention due to the challenges of obtaining identification worldwide. In fact, the World Bank estimated that one billion people cannot verify who they are and as a result cannot gain access to crucial services.

To overcome these barriers, Mastercard and other private finance companies are hoping to use the advances of biometric authentication to streamline the distribution of digital IDs in developing countries. It has become an industry practice to promote financial inclusivity through such identity programs, which Mastercard and Paycode are doing extensively in their marketing collateral. But their messaging lacks concrete steps of civic integration, and many experts in the public sector are concerned with how or if Mastercard’s case for accessibility will be tested against country-specific procedural requirements to protect their already-established financial system. 

Digitization and Liability

“If you leapfrog into digital identity without getting civil registration infrastructure online, you’re going to have a problem,” says UNICEF Associate Director and Global Chief of Child Protection Cornelius Williams. Countries such as Egypt, South Africa, Namibia, Botswana and Madagascar are advancing into digital identities before building effective legal framework, according to Williams. Likewise, there is little discussion on mandates that will address concerns like data privacy as Mastercard plans to roll out their programs in Botswana, Ghana, Guinea, Mozambique, Namibia, Nigeria, Uganda and Zambia, where Paycode already operates.

Mastercard will be utilizing Paycode’s Electronic Data and Payments Technology platform (EDAPT) which allows financial institutions to become the issuers of the smartcards. Paycode’s data and payment management information system can also be used for both financial and non-financial means, enabling the big data of smartcard identities to be analyzed in real time. 

The World Bank ID4D Group’s 10 Principles for Identification aims to strengthen collaboration between private companies and national governments to formulate their identity foundations. The guide recommends a strong delineation of liability and recourse for individuals under these identity programs to be overseen by independent regulatory bodies with appropriate powers. In addition, it calls for clear accountability and transparency around the responsibilities of private entities like Mastercard who are involved in building and managing national identification systems. The UN’s Africa Programme for Accelerated Improvement of Civil Registration and Vital Statistic (APAI-CRVS) also provides an agenda for 2030 to prepare policymakers for these types of collaborations.

The Future of African Identity

Building holistic identity and financial systems in developing worlds are crucial to unifying sectors such as health, education and welfare. Policymakers are highly motivated to build systems that work because of the development goals they can achieve with functional digital identity systems.

“How the private sector operates in this field is now very critical,” said Williams. Mastercard and Paycode’s mission to level the financial playing field in African countries will depend on how much they invest in interoperability.

The program is set to rollout this year.


Ivy Tsang is a Tech Innovation Fellow at Identity Review from the University of Southern California, where she explores the intersections between the Arts, Technology and Business of Innovation. 

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