Kazakhstan shows DPI policy path to digital transformation gains

Almost all of Kazakhstan’s second-tier banks and 75 payment, microfinance and other financial organizations are now connected to the country’s biometric authentication system, with digital identity used to access a growing number of public and private services .

The country represents a positive example of how to effectively implement digital public infrastructure for developing and emerging markets, says a report from the Center for Strategic and International Studies (CSIS).

Kazakhstan began requiring biometric authentication for loans in August, but the full launch of the national biometric authentication system is expected to expand the use of biometrics to even more sectors.

Already, the use of online banking in the country has increased from around one in four people in 2018 to near universality among Kazakhs. Digital transactions have increased from 7% ten years ago to 89%.

Kazakhstan rose to 28th place in the UN Digital Government Index in 2022 and has digitalized more than 1,000 government services.

The country also works with its neighbors to facilitate cross-border travel and trade.

CSIS identifies an open and competitive payments market, the provision of secure digital identification and public-private partnerships as key enablers of Kazakhstan’s digital transformation. The country’s progress on IPD is also supported by consumer protection and cybersecurity measures that have reduced online fraud as transactions have increased, as well as large-scale education campaigns. The government has invested in providing underserved populations with network access so they can use digital payments and government services, and has encouraged financial innovation with regulatory sandboxes and co-investments in financial services companies. financial technology and e-commerce.

This sum is a system that aligns with the G20 policy recommendations on IPD and can serve as a model for other countries, according to the report.

“Although the specific design features and diffusion strategies of digital infrastructure do not always transmit across markets,” CSIS asserts, “these policy principles do.”

Article topics

biometric authentication | digital economy | digital identification | digital public infrastructure | financial inclusion | government services | Kazakhstan