As the surge in synthetic fraud across Africa continues to cost banks and lenders hundreds of millions of dollars each year, MasterCard and identity verification provider Smile ID are strengthening their relationship to combat the problem.
The two companies plan to tackle identity fraud in Africa, improve digital identity verification processes, and facilitate secure transactions in the continent's growing digital economy.
As part of the partnership, MasterCard has made a minority investment in Smile ID to promote digital inclusion and innovation in Africa.
The agreement also enables banks, fintechs, mobile money carriers, and other businesses to on-board new customers more quickly, eliminating identity fraud and increasing access to the financial system.
Furthermore, it integrates MasterCard's identification technology, enabling users to authenticate digital identity elements, with Smile ID's data verification and fraud detection technologies.
Selin Bahadirli, executive vice president, services, MasterCard Eastern Europe, Middle East, and Africa, commented: “This partnership with Smile ID is a pivotal step in advancing digital trust and inclusion across Africa.
“As fragmented identity systems slow down businesses and lock millions out of the digital economy, Smile ID’s innovative identity platform complements Mastercard’s commitment to fostering secure and inclusive digital ecosystems.”
Mark Straub, CEO of Smile ID, added: “The surge in synthetic identity fraud in Africa is costing banks and lenders hundreds of millions of dollars a year. By joining forces with MasterCard we can help turn the tide.
“As we combine insights and technologies, we can expand opportunities for consumers by giving banks and mobile wallets the confidence to on-board the next 300 million African users securely.”
This collaboration follows MasterCard's recent analysis that Africa's digital economy is expected to reach $1.5 trillion by 2030. As such, trusted identification solutions are a crucial enabler of financial inclusion, fraud prevention, and cross-border trade.
Furthermore, as smartphone usage grows, there is also an urgent need to unlock opportunities for millions of people through secure identity verification systems that function across digital channels, according to analyst.
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