One of the key promises of fintech has been to use digital identification to enhance development interventions. Fintech firms are increasingly collaborating with financial institutions, development organizations, and philanthropic foundations that enhance access to the financial system through digital identity databases. As a result, financial inclusion strategies have come to be heavily reliant on digital infrastructures. These infrastructures are a product of global and local shifts in development strategy, which is increasingly aligned with an international security agenda. To explain this, this chapter studies the actors, objects, and processes essential to these infrastructures. It uses examples from India and Pakistan to show how these infrastructures have their roots in the KYC or know-your-customer requirement that policymakers use biometric databases to implement. These examples reveal how tools initially intended to enhance financial access became foundational to the broader issue of social policy.

The full potential of FinTech may best be realised by a progressive approach to the development of the underlying infrastructure for digital financial transformation. We suggest in this chapter the best way to think about such a strategy is to focus on four primary pillars. The first pillar requires the building of digital identity, simplified account opening, and e-KYC systems. The second pillar is open interoperable electronic payment systems. The third pillar involves using the infrastructure of the first and second pillars to underpin electronic provision of government services and payments. The fourth pillar is the design and development of digital financial markets and systems, which supports broader access to finance and investment. Implementing the four pillars is a major journey for any economy, but one with tremendous potential to transform financial systems, economies, and societies.