Addressing the Digital Divide in 2024

The names of the individuals have been changed to maintain their privacy and anonymity.

Zaarah, a Libyan refugee, lost her passport and ID during her escape from conflict. Despite receiving asylum in Hungary, she struggles to access basic services due to the country’s rigid asylum policies. Even with a temporary refugee card, she is denied health insurance because the automated system requires a passport or national ID, leaving her without essential medical care.

Similarly, Jesús from Spain, who lost an eye in a car accident, faced issues accessing his brokerage account because the platform’s facial recognition system couldn’t verify his changed appearance. Despite his efforts, the inflexible system left him locked out of his account and unable to access his funds. Both of these cases demonstrate how rigid verification systems widen the digital divide.

According to Sumsub’s research, an estimated 627 million people are digitally excluded globally—a figure larger than the combined populations of the United States and Brazil. 

Addressing digital inequality requires long-term action by countries and international institutions. However, there are steps that online businesses and regulators can take now. 

Let’s dive into the root causes of digital inequality and how businesses can mitigate it through advanced verification.

How does digital inequality vary around the world?

The digital divide varies significantly by geography and economic development.

High-income countries generally offer better internet access and infrastructure, though rural and low-income populations in places like the US still face access challenges, with urban residents enjoying nearly twice the connectivity level of rural ones.

Low-income countries, especially in parts of Africa and Asia, struggle with limited internet access, few digital devices, and lower digital literacy, particularly in rural areas which often lack connectivity. Even within digitizing regions like Asia’s APAC, inadequate rural infrastructure and high costs restrict access for many, widening the divide and leaving some vulnerable to fraud exploitation, such as becoming money mules or unwittingly participating in fraud rings.

In high-fraud-risk countries, individuals face exclusion as businesses avoid onboarding them, pushing these users toward less secure services, including fake phishing services, and thus contributing to overall fraud proliferation.

The global digital divide is also influenced by unequal government investment in digital infrastructure, with progress often slowed by political instability or economic constraints. 

How does digital inequality contribute to fraud proliferation?

The digital divide increases fraud in several ways:

• Lack of digital literacy: Individuals with limited internet access are often unaware of threats like phishing and identity theft, making them more vulnerable to fraud.
• Limited access to secure systems: Without secure devices or reliable internet, people are more susceptible to attacks through outdated software or unsecured connections.
• Dependence on unregulated channels: Those lacking secure online access may rely on informal systems for transactions, which heightens fraud risks due to inadequate safeguards.
• Social and financial exclusion: Marginalized individuals often turn to less secure alternatives, exposing them to predatory lenders and scams.

Digitally exclusion can also lead individuals to turn to fraud:

• Economic strain: Without access to formal employment or financial services, some may resort to fraud as a means of survival.
• Exploitation by crime networks: Organized groups may exploit vulnerable  individuals, recruiting them as intermediaries in fraud schemes.

What are the global impacts of digital inequality?

Digital inequality can:

• limit access to critical services such as healthcare, employment, and education
• stifle innovation
• perpetuate inequality
• increase social isolation
• hamper global economic development
• contribute to fraud proliferation
• negatively impact businesses by costing them revenue when millions of users are unable to access their services.

Collectively, digital service providers risk losing $1.75 trillion in revenue by excluding digitally marginalized individuals—users who are otherwise eager to participate in the digital economy. With global digital commerce projected to grow nearly 8% annually from 2024 to 2028, digital transactions for these excluded individuals could exceed $2.46 trillion by 2028.

What causes digital inequality?

According to Sumsub’s research, approximately 627 million people are digitally excluded globally (refer to Sumsub’s Whitepaper to learn the details of Sumsub’s research methodology).

This is due to: 

• ID problems


According to Sumsub’s research, 243 million people may need help accessing services because their identity documents are non-standard
or outdated.

• Digital literacy


219 million individuals could be left behind due to a lack of digital skills.

• Physical appearance 

96 million people experience challenges in verification processes because their appearance differs from their ID photos
due to medical conditions or other factors.

• Country of origin


Over 70 million individuals may be blocked by indiscriminate, country-based exclusion. Due to high fraud rates in certain countries, digital businesses often choose to exclude some markets entirely from accessing their services, thereby missing untapped economic opportunities.

By using advanced verification solutions, businesses could expand global access to their services, unlocking a new, underserved market with vast economic potential.

What can be adopted today to reduce digital inequality?

As essential services increasingly move online, the number of individuals affected by rigid verification processes will continue to rise, unjustly putting many at risk of being cut off from vital governmental and societal functions. While verification systems were originally designed to keep fraudsters at bay, inflexible practices may fail to recognize and onboard legitimate users, forcing them to rely on less secure services and increasing their risk of falling victim to fraud.

By adopting more inclusive verification practices, companies can onboard millions of legitimate individuals, protect them from using unsecured services, and tap into a vast, underserved market, transforming the moral imperative of inclusion into a significant economic opportunity. Here are the key initiatives which can be adopted now:

Onboarding flexibility and non-documentary verification

Poor-quality IDs can be addressed through non-documentary verification, which is AML-compliant in multiple jurisdictions, including India, Nigeria, South Africa, Indonesia and Brazil, among others. Non-documentary verification allows businesses to potentially verify user data for over 5.5 billion people worldwide, including typically excluded markets—all done quickly and securely without requiring multiple document uploads.

Smarter verification flows

Onboarding individuals from high-risk countries—whom businesses might otherwise exclude—can be made safer by implementing detailed onboarding processes with additional checks. Smart workflow builder technology allows online services to set up verification scenarios tailored to various user groups, adjusting the number of checks (e.g. adding enhanced due diligence) based on user geography. This way, online businesses can ensure their services are accessible to honest users even in high-risk countries, but remain secure against fraudsters.

Ongoing monitoring

By implementing advanced, real-time monitoring tools that detect and block bad actors only when they engage in illicit activities, digital inclusion can be significantly enhanced. This strategy shifts the focus away from preemptively rejecting users during onboarding—based on assumptions about their risk due to their region—and instead allows for legitimate users to participate freely, with interventions occurring only when their actions warrant it.

User-centric design

Enhancing verification processes for users with lower digital literacy can play a crucial role in bridging the digital divide while upholding regulatory and security standards. By simplifying steps, designing user-friendly interfaces, and building systems that accommodate human error, services can become more accessible to marginalized communities. This ensures inclusivity without compromising security or increasing the risk of fraud.

Leveraging innovation

Utilizing and training artificial intelligence, advanced optical character recognition, and advanced data models to recognize a broader range of identities—including those affected by medical conditions or using non-standard documents—can significantly enhance digital inclusivity.

What’s the future of digital inequality?

This depends on continued efforts to make technology more accessible, affordable, and equitable. Bridging the divide will require sustained investments in infrastructure, education, and policy reforms. If successful, the digital gap may narrow, allowing more people to participate in the global online ecosystem. However, without proactive measures, the divide could widen, especially as new technologies create additional barriers for those already struggling to catch up. Ensuring digital inclusion will remain a priority for global development in the years to come.

Download Sumsub’s whitepaper to learn more about modern digital exclusion, the methodology used in Sumsub’s research, and how digital inequality can be addressed today.

Whitepaper