The Central Bank of Azerbaijan Accelerates Digital Transformation with the First Blockchain-Based Digital Identification System in Azerbaijan

Posted on Feb 18, 2021 by Farid T. Osmanov, Executive Director, Central Bank of the Republic of Azerbaijan

INTRODUCTION

Over recent years, active penetration of information and communication technologies has created new business opportunities for financial institutions, defining a digital transformation phenomenon. In particular, enhancement of digitalization in customer experience transformation has initiated fundamental changes in the banking sector, bringing disruptive technologies and innovations, and expanding the volume of digital transactions. In a similar vein, there has been an explosion of digital transformation initiatives in Azerbaijan as part of the fulfilment of the “State Program on Expansion of Digital Payments in Azerbaijan for 2018-2020.” Approval of the State Program was a driving force to establish a cashless economy, revolutionizing the digital landscape and digital payments in Azerbaijan.

As one of the priorities of the State Program, the Central Bank of the Republic of Azerbaijan (hereinafter—Central Bank of Azerbaijan) implemented the Blockchain-based Digital Identification System (hereinafter—DIS) to increase financial inclusion and ease digital access to banking services in the country. The main rationale behind this initiative was to ensure full control over personal data and establish permissioned access to data credentials by maintaining the confidentiality and integrity of personal data. Therefore, the blockchain—distributed ledger technology (hereinafter—DLT) was tested in this pilot.

The rest of this paper is distributed as follows: the Business context section describes ...

Read more in the CBPN Members' Library with your annual subscription.

No part of Central Bank Payments News may be reproduced, copied, republished, or distributed in any form or by any means, in whole or in part, without the express and prior written permission of the publisher, Currency Research Malta, Ltd.

Latest Posts

  • Bangladesh: Payment Systems Development
  • In Conversation with Sheila Warren
  • EMTECH: The Coming Modernization of Central Banking

Tags

Digital Identity, Blockchain, DLT, Digital Banking