Cabinet this week announced its support for the collaboration between the Department of Home Affairs (DHA) and the banking industry regarding fingerprint verification.
The agreement will see banks having access to the Home Affairs National Identification System (Hanis) to verify the identity of current and prospective clients, since Hanis is a database of South African citizens' ID numbers, fingerprints and photos.
Cabinet says this online fingerprint verification model is intended to assist the banks to curb identity-related fraud and corruption, which is costing them and the economy millions of rands.
“This will assist the department's mandate in protecting the identities of South Africans, while assisting in the national effort to push back the frontier of fraud and corruption.”
Government hands
The banking industry is being represented by the South African Banking Risk Information Centre (Sabric) for this project.
It said the project will be launched within the next few weeks. Spokesperson Bongani Diako says the project is now in the hands of the DHA.
The department said the system will be implemented soon and further details will be discussed at that point.
Preventing fraud
The third phase of the project, which focused on costs and provided the necessary data for all stakeholders to complete their internal business cases, was running in July last year.
Sabric CEO Kalyani Pillay said the first phase of the project was completed in 2009, and proved the feasibility of online fingerprint verification of banking clients. The second phase looked at the prerequisites for formally implementing and rolling out access by banks.
“We are very excited about the prospects of this unique project, as we anticipate that it will assist the banks in reducing application fraud and identity theft. Banks have a challenge regarding the authentication of the identity of clients given the scale of fraudulent documents in the country.
“We anticipate that the project will help with the prevention of crimes such as falsified facility applications and account takeover fraud,” says Pillay.
Security priority
However, managing partner of IT advisory at KPMG Frank Rizzo previously expressed some concern about this system, since the information attached to one's fingerprint is personal, and is now being distributed to a wider system.
“The information is very sensitive, so we have to see that the proper security measures are in place. What are the security measures and the destruction methods?”
Rizzo questions what a bank will do with the information of individuals if they are no longer with that specific bank. He says deleting the information will be the ideal destruction method, because customers cannot change their fingerprints as they do their pins or passwords.
He sees the value in this system, but insists the appropriate security measures be taken. “The advantages are huge. It's a very strong method for the proof of authentication. I think the initiative is great, but I'd like to see the proper security measures in place.”
Pillay says: “The integrity and security of the system and data will not be compromised at all. All the parties concerned with this initiative will take the necessary steps to ensure this.”
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