Ethiopian Prime Minister Abiy Ahmed has lauded the Fayda digital ID system as a linchpin of the nation's ambitious 'Digital Ethiopia 2025' strategy (summary in English here). This strategy sets forth a vision to issue 90 million digital IDs (delayed to 2028), triple digital payments, and foster increased interactions among government, private sector, and citizens by 2025. The mid-term review of the 'Digital Ethiopia 2025' strategy took place last week, completed by a post by the Ethiopian Artificial Intelligence Institute.

Fayda, a biometric system, encompasses critical personal information such as name, gender, iris scan, fingerprints, date of birth, address, and photograph. Supported by the World Bank, the rollout of Fayda aims to register all eligible Ethiopians by the end of 2025.

Moreover, the National Bank of Ethiopia (NBE) has outlined intentions to adopt Fayda as the primary form of identification for all financial institutions in Ethiopia, thereby enhancing financial inclusion by dismantling entry barriers. The incorporation of Digital ID as a Bank ID promises to significantly enhance transparency, stability, and security within Ethiopia's financial sector, synergising with national development strategies geared towards fostering a digital economy.

Why does it matter?

The potential of digital IDs to enhance development is being demonstrated in Ethiopia. Not only will digital IDs be required for Ethiopians to access government services, but they have also been used to empower refugees and returnees to register with the state bureaucracy. In addition, financial institutions' widespread adoption of Fayda as a Bank ID promises to democratise access to financial services, fostering greater financial inclusion and economic empowerment across Ethiopia.