Bhutan introduces new digital identity system

Bhutan ranked one of the world’s poorest and least developed countries, has developed a novel digital ID system known as Bhutan NDI. Despite facing practical constraints and limited resources, Bhutan has pioneered a self-sovereign identity (SSI) system that revolves around a digital wallet offering five levels of integration.

The first level allows users to access government services with a single sign-on function. The second level facilitates data exchange through proof requests and verifiable credentials (VCs) issuance. The third level handles complex proof requests such as Know Your Customer (KYC) processes using multiple VCs. The fourth level enables cross-border collaborations, including a partnership with India’s Digi Yatra to incorporate boarding passes into Bhutan’s digital wallets. Lastly, the fifth level includes the addition of an AI layer.

The digital wallet also incorporates a digital signing platform, made legally binding by the Digital Identity Act passed by Bhutan’s parliament. The act ensures that electronic signatures hold legal validity. To prioritize privacy and data security, Bhutan has transitioned from a centralized database to a decentralized system in which specific ministries hold discrete data points that cannot be shared with other databases.

Biometrics is crucial in Bhutan’s digital ID system, particularly facial recognition for identity verification. The next release of the app may also include contactless fingerprint scanning. Bhutan has explored various biometric modalities, such as fingerprints, facial scans, irises, palms, and finger veins.

Why does it matter?

Bhutan’s SSI system aligns with the principles of self-sovereign identity, giving users control over their data and the ability to consent for specific periods. Data is not stored centrally, and users can request the deletion of their data, including by the government. However, this comes with the caution that services cannot be provided to individuals with unknown identities. The success in developing its SSI system also shows that limited resources can be sufficient to advance a digital ID system.