Estimated reading time: 5 minutes
 

Across the world, governments are trying to digitise their economies. To be successful, they need to build strong digital public infrastructure. What are the key challenges? And how can they succeed?

Since the industrial revolution every great leap of progress has been powered by public infrastructure. Canals and railways, the electric grid, road networks, broadband – all of them have created the foundation for innovation and value creation. 

Now, attention is turning once again to public infrastructure. This time, the focus is on the 21st century version: digital public infrastructure (DPI).
 
Societies all over the world are asking: how can we build a strong digital foundation so that citizens can access public and private services with ease and safety.

Defining DPI

Before we dive into this question, let’s establish what DPI is. In a report titled Digital Public Infrastructure and Development, the World Bank defines DPI as “an approach to digitalisation focused on creating foundational, digital building blocks designed for the public benefit.” It adds that a DPI system must follow principles such as: inclusion, openness, modularity, inclusivity, user-centricity, privacy-by-design and strong governance. 

The World Bank report focuses on three systems that provide core DPI functionality. They are:

•    Data sharing 
•    Digital payments 
•    Digital ID and e-signatures

It explains that these three components “sit on top a country’s physical infrastructure and below the layer of platforms and applications that…deliver specific services.”

To be more specific, physical infrastructure comprises internet connectivity, devices, servers, data centres etc. Meanwhile the platforms and applications include public and private apps, registries and software serving verticals such as fintech, health, tax and more.   

In this article, let’s focus on what many consider to be the foundation of the DPI stack: digital identity.

The upside of a strong digital ID framework

Governments know that a robust universal system for identifying citizens, companies and devices can deliver enormous societal benefits. However, in a world of remote transactions, scanning and uploading paper ID documents is not fit for purpose. Instead, the identity framework needs to be digital. This is a challenging task – especially for developing countries that don’t have a reliable ‘analogue’ civil registration system on which to build it.

There are different ways to design a digital ID framework. It can be centralised – provided by a national ID or civil registration department. It can be federated. Here, multiple providers work together in a shared trust framework. A third option is for users to control credentials in a decentralised model, typically in a digital wallet on a smartphone or smartcard. 

A decentralised system typically works like this: a user requests a digital version of his ID credential (passport, academic qualification etc.). He stores it in a wallet and presents it when asked to verify his identity to a third party. A major advantage here is that the credentials are held locally so the end user controls their use.

Digital ID: launches and market estimates

The migration to digital ID is well under way. Since 2015, 98 countries have announced plans to create one. Some services are well-established. They include schemes in India, Estonia, Brazil, UAE and elsewhere. Then there is the EU, where all 26 member states will offer a digital wallet by December 2026. 

What’s driving this activity? One factor is economic value. The tech simply makes doing business easier. McKinsey estimates it could unlock the equivalent of 3 to 13 percent of GDP by 2030. 
 

Barriers to building a robust digital ID framework

Still, many countries have struggled to build digital identity system that can serve as foundational public infrastructure. World Bank’s report explores why and outlines the factors governments should consider when tackling the problem. So, what are the barriers? World Bank names five.

•    Legacy platforms that lack interoperability, modularity, security or inclusivity.
•    Inadequate civil registration systems that cannot provide trusted identity data.
•    Poor institutional support or resources.
•    Bad governance, inadequate data protection and other safeguards.
•    Exclusion of citizens who cannot afford access or lack digital literacy.

How to get digital ID right: technology and non-technology enablers

To address the above challenges, the report focuses on the technology and non-technology enablers that underpin DPI. Let’s explore them.

Technology enablers

Open standards
World Bank considers open standards a critical enabler for building successful and sustainable DPI. Standards make DPI easier to scale and evolve with user needs. Systems should use open specifications and/or APIs, along with clear governance frameworks.

Connectivity and Devices
Broadband connectivity is a crucial foundation for DPI. Many countries are investing in hard infrastructure, and also in service points where people can access online services in person.

Public Key Infrastructure (PKI)
PKI cryptographic technology lets authorities issue digital certificates to citizens and supports the use of e-signatures.

Data Centers and Cloud
Scalable and secure DPI systems require access to reliable, data hosting, whether on premises or via the cloud

Data-Driven Innovation
New technologies have the potential to boost DPI development. They 
include machine learning, quantum computing, edge computing and more. World Bank cites the example of Brazil, where edge processing lets healthcare firms offer telemedicine in remote regions with limited connectivity.

Non-Technology Enablers and Safeguards

Governance and Institutions
Most countries are unlikely to have a single framework on “DPI governance,” as DPIs are typically provided by different entities. With digital ID this could be the national ID or civil registration agency. Trust frameworks should outline roles and responsibilities for ID and e-signature providers, specifications for specific levels of assurance and so on. 

Cybersecurity, Resilience and Operational Reliability
Interlinked systems like DPI increase the risk of cyber attacks. So DPIs should incorporate privacy-enhancing technologies, robust security measures and resilience against threats or system failures. There should also be continuity planning. 

Digital Inclusion, Literacy, and Skills
“Inclusion first” is a core principle of DPI. Services should be for everyone – including citizens who live in remote areas or lack digital literacy.

Conclusion

The World Bank report presents a detailed picture of DPI, especially in the area of digital ID. It offers a roadmap for overcoming the challenges countries face when trying to build robust systems. But it also articulates the rewards: a dynamic digital private sector and public services that work for all citizens.