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A growing number of developing countries are using biometric technologies to create national identification programs or for more specific needs, including cash transfers, voter registration, and disaster relief. CGD’s research shows how biometric ID can help improve public service delivery, advance progress on many of the Sustainable Development Goals, and helps shape global best practice in applications that use the technology. Our work on India’s pioneering Aadhaar system aims to understand how it has impacted a billion Indian lives, and how the technology could be useful to other developing countries.
The state of Rajasthan in north India has become the digital frontier, with a program that registers all family members under a single identity document known as the “Bhamashah Card,” but it still has to overcome significant challenges of poverty and inequality. In a state that is similar in size and population to Germany, it is no small achievement to take on the ambitious task of providing each family with a unique ID and deliver it within a short span of three years.
In the modern world, many everyday transactions—such as opening a bank account, registering for school, activating a SIM card or mobile phone, obtaining formal employment, or receiving social transfers—require individuals to prove who they are. For an estimated 1.5 billion people in developing countries, this creates a serious obstacle for full participation in formal economic, social, and political life. With this in mind, more than 15 global organizations have jointly developed a set of shared Principles that are fundamental to maximizing the benefits of identification systems for sustainable development while mitigating many of the risks.
These recent developments in identification, combined with rising mobile phone ownership, broadening Internet access, and innovative payment delivery mechanisms, can be harnessed to transform the way states implement poverty-reduction programs and improve the lives of their citizens. Digital payments promise faster, more transparent, and lower-cost delivery for existing cash-based government transfers, and can also transform the way governments deliver subsidies. In a new background paper, Dan Radcliffe reviews the evidence on the gains from digital payments and pinpoints four ways in which they can improve development outcomes.
CGD continued its commitment to the subject of financial inclusion with the release this March of Financial Regulations for Improving Financial Inclusion. As co-chairs of the Task Force that produced this report, we are enthused to see much alignment between the High-Level Principles of the G20 and the CGD Task Force report.
India’s shift towards direct benefit transfers (DBTs) is on the fast track. According to official statements, in the 2015-16 fiscal year the central government deposited nearly $5 billion of subsidy and welfare payments directly into the bank accounts of 300 million beneficiaries. It has also set an ambitious target to transfer all payments to the Aadhaar-based biometric DBT platform by the end of 2017. This will surely be the greatest subsidy reform in the world, but we need more data to accurately evaluate its impact.
Effective identification is increasingly seen as a crucial step towards the achievement of several other development goals. In fact, developing countries have been implementing new ID programs at a breakneck speed. To provide a relatively comprehensive picture of these rapidly changing trends, fast-evolving systems, and mushrooming applications is no easy feat, but we have tried to assemble a rough overview of those ID- and development-related topics that struck us as most relevant in the form of a Preliminary Discussion Paper.
Universal legal identity through birth registration has consistently remained as a potential target for the post-2015 agenda through several rounds of negotiation. However, as it has been put forth, it conflates legal identity and birth registration. This policy note clarifies the differences between legal identity and birth registration and offers measurable, achievable target language for each component to ensure that this important issue remains in the post-2015 development agenda in an impactful way.
Onerous KYC documentation requirements are widely recognized as a potential constraint to full financial inclusion. However, it is sometimes difficult to judge the extent to which this constraint is a serious or binding one, relative to others. The paper considers this question, distinguishing between different types of documentation and different financial market segments according to their KYC requirements.
Biometric identification systems that are in place or under consideration in many countries present significant privacy consequences principally relating to information privacy or data protection. This paper discusses personal privacy in the context of the adoption of biometric identification systems.
CGD, along with Data2X and the World Bank Group, recently hosted an event on the intersections of civil registration and vital statistics (CRVS), legal identification, and gender equality. That sounds like a mouthful, to be sure, but it all comes down to one simple idea: both men and women need to be able to prove who they are, so that they can exercise their rights as citizens and be counted by their governments.