Each year, digital identification (eID) becomes increasingly significant worldwide, transforming how people interact with government agencies, businesses, and each other. It provides citizens with electronic IDs to simplify access to services and handle many daily tasks online. However, alongside its clear benefits, this trend also raises concerns related to data protection and privacy. Let’s examine how digital identification is developing across different countries and the advantages and disadvantages it brings to society.
V. Korchagin, PhD, Editor, Columnist, October 3, 2024, Switzerland
Advantages of Digital Identification
Digital identification simplifies numerous aspects of citizens’ lives. In countries like Estonia, where eID is widely used, administrative processes have become much faster and more accessible. Citizens can remotely register companies, vote in elections, pay taxes, and sign documents, significantly saving time and effort. Introducing eID not only helps governments reduce administrative costs but also improves the quality of citizen services.
In India, the Aadhaar system provides millions of citizens access to banking and medical services, especially in remote regions where such services were previously hard to obtain. Digital identification has thus become an essential tool for financial inclusion, enabling millions of people to open bank accounts and receive subsidies.
Digital identification also enhances transparency, especially in the distribution of government benefits. In India, Aadhaar has helped reduce corruption by providing accurate information on who is eligible for which benefits. The transparency that digital IDs bring contributes to fair resource distribution and reduces opportunities for fraud.
For businesses, digital identification also offers advantages. Companies can identify customers faster, reducing data verification costs and minimizing fraud risks. In Europe, digital identification is already widely used in the financial sector to streamline access to banking services, account openings, and lending.
Risks and Privacy Issues
However, implementing digital identification also poses significant risks, particularly around data security. Large databases containing biometric and personal information created through eID systems become targets for hackers and malicious actors. For example, India’s Aadhaar system experienced a data leak affecting millions of users, raising questions about the security of eID systems even in technologically advanced countries.
Another concern is potential infringement on privacy rights. In some countries, such as China, citizens’ data is used to monitor behavior and interactions. In China, digital identification is closely tied to the social credit system, which can restrict citizens’ access to certain resources and services. This raises concerns among human rights advocates, who argue that such systems could become tools for control and oppression.
Digital identification also risks data centralization, as a single government or private organization gains access to all information about citizens. This centralization could lead to abuses by governments or corporations, who may use this data for marketing and advertising purposes.
The Future of Digital Identification
Despite the risks, experts agree that digital identification will continue to evolve and integrate into daily life. Europe is developing the eIDAS 2.0 system, which will allow citizens to use a single digital identifier to access government and private services across all EU countries. This will significantly simplify cross-border interactions and create new opportunities for citizens.
Cybersecurity experts emphasize the importance of developing international security and privacy standards for digital identification. Such standards will help minimize risks and protect citizens’ rights while ensuring convenient access to services. The development of decentralized identification systems (DIDs), like those Microsoft and IBM are working on using blockchain, may offer a solution to these challenges.
The future of a digital society depends on balancing convenience and security effectively. As technology advances, digital identification could serve as a tool to improve citizens’ lives or as a means of control. It is crucial for this tool to be used to benefit society and its progress, rather than infringe on human rights and freedoms. Transparency and accountability are essential in advancing these technologies to ensure that society remains informed and empowered to control the processes, so we all avoid ending up in a digital dystopia.
