The Future Is Frictionless and Verified: How Digital ID Is Reshaping APAC

In Asia-Pacific—where non-cash payments raced 20.4% higher last year—the real bottleneck isn’t access, it’s proving who you are. Requiring the same passport selfie for every new bank, marketplace, or ride-hailing app is draining patience and conversions, and it’s why the global verification business ($11.97 billion in 2024, heading for $39.82 billion by 2032) now takes many of its cues from this region. Governments from Singapore to India are rolling out digital IDs that let people clear KYC once and carry those credentials everywhere, while businesses reap faster onboarding, lower fraud, and wider reach.

In this interview, we’ll explore what digital identity means for APAC—a region experiencing explosive digital growth—and how it incentivizes the development of reusable identity in the region. While adoption varies from country to country here, the trend is unmistakable: digital identity is on the rise.

Joining us today is Penny Chai, Vice President of APAC at Sumsub. She’ll walk us through the key challenges consumers and businesses face with verification, the emerging role of digital and reusable identities in solving these issues, and which industries are likely to lead the charge.

THE SUMSUBER: APAC has seen rapid digital transformation in recent years, particularly in fintech, e-commerce, and government services. For example, APAC is leading the world in digital payments innovation. Systems like Singapore’s PayNow, Thailand’s PromptPay, and India’s UPI have driven a 20.4% year-on-year growth in non-cash payments in 2024, outpacing Europe and North America. How has this surge impacted digital identity verification trends in the region?

PENNY CHAI: APAC—especially Southeast Asia—is right in the middle of a digital revolution. We’re seeing huge growth in internet access, mobile tech, and digital adoption, which really accelerated during the pandemic. As a result, digital identities have become essential. More and more, access to services—whether financial, governmental, or social—is tied to your digital presence.

But as transformation accelerates, a major issue is emerging: AI-driven fraud. According to Sumsub’s APAC Identity Fraud Report for 2024, identity fraud in the region surged by 121% year-over-year. In some countries, it’s even more dramatic—Singapore saw a 207% increase, Indonesia 205%, and Thailand 201%. Deepfake fraud, in particular, is becoming a real concern. It jumped 194% YoY and now makes up about 7% of all fraud attempts in the region. 

A recent disturbing example: just this year, in Singapore, scammers using deepfake tech almost tricked a finance director into transferring nearly half a million US dollars. And last year, a company in Hong Kong lost $25 million to a deepfake scheme. So, it’s a very real, growing threat.

At the same time, regulators across APAC are stepping up. We’re seeing much stricter AML/KYC requirements coming into play. It’s not just about ticking boxes anymore—regulators want to build trust in the digital economy. Singapore’s MAS, for instance, is leading the way with strong guidelines around digital identity verification, especially in financial services. That’s pushing companies to invest in smarter, more secure verification technologies.

And we can’t forget that APAC is a mobile-first region. Most users here are accessing services primarily via smartphones. So, identity verification solutions have to be designed with that in mind—they need to be seamless and secure on mobile. Technologies like Sumsub’s Liveness Detection, which can be built right into mobile apps, are a great example of how we’re adapting to that shift.

THE SUMSUBER: You’ve mentioned challenges—could we explore those a bit further? What are the biggest pain points consumers in APAC face during verification processes, and how do these impact businesses?

PENNY CHAI: I see several major challenges consumers are dealing with. 

First, there’s what we call the onboarding bottleneck. Verification processes are often long, complicated, and frustrating—especially for people navigating cross-border living or employment. Take, for example, someone trying to open a bank account in a new country. They might need to go through multiple manual steps to verify their work permit and identity, which can involve a lot of paperwork, long wait times, and back-and-forths. Such poor UX leads to friction and higher drop-off rates. 

Then there’s fragmentation. The lack of standardization across platforms means consumers often have to verify their identity from scratch each time they use a new service. There’s no continuity, which adds to user frustration and slows everything down.

Another major issue is digital exclusion, which is particularly pronounced in parts of Southeast Asia. According to Sumsub’s Greenflag research, over 627 million people globally are either excluded from or struggle to access digital services—and that represents a huge economic opportunity, about $1.75 trillion USD. In APAC alone, we’re talking about a region with over 4.3 billion people, yet nearly 40% of them are still not connected to the internet. That’s a massive gap.

And all of these consumer challenges—onboarding delays, fragmentation, digital exclusion—ultimately affect businesses, too. They drive up onboarding costs, slow down customer acquisition, and can even harm brand trust. For businesses, bridging this gap can mean investing in digital infrastructure, improving digital literacy, and adopting more inclusive verification methods. That includes supporting users with low tech skills and offering alternatives like non-documentary verification where possible.

THE SUMSUBER: How are these challenges influencing the development of digital ID solutions in APAC?

PENNY CHAI: One of the biggest shifts we’re seeing is the emphasis on user experience. Digital ID solutions today are being built with the user front and center. The goal is to overcome verification challenges, to make verification seamless, intuitive, and as frictionless as possible—because that’s what today’s consumers expect.

The user-centric approach inevitably leads to the development and wider adoption of reusable ID in the region—a type of digital ID that allows the user to verify their identity once, and then reuse that verified identity across multiple platforms and services.

There’s definitely growing momentum around decentralized identity. More and more, users want control over their own data, and decentralized models allow exactly that. Instead of their identity information sitting in centralized databases, users can store it on their own devices and decide when and with whom to share it. 

Another major driver is the collaboration between the public and private sectors. We’re seeing more governments and companies working together to build interoperable digital ID systems that are secure, efficient, and widely usable. 

A great example is Singpass in Singapore—it’s a unified digital identity platform that lets users access a whole range of government and private services with just one login.

Hong Kong’s ‘iAM Smart‘ platform is another strong case. Launched in 2022, it aims to give every citizen a single digital ID to use for both government and commercial services. It’s gained a lot of traction, with over 342 million user registrations so far.

THE SUMSUBER: Singapore and Hong Kong show how fast adoption can happen when digital ID systems actually work for people—simple logins, broad access, real benefits. So who else is getting it right? And which regions are still playing catch-up—or about to make a leap?

PENNY CHAI: APAC is incredibly diverse, and that diversity really shapes how digital identity is being adopted across the region. We’re talking about countries with very different levels of infrastructure, regulatory maturity, and socio-economic development, so naturally, their approaches to digital ID vary widely.

Some markets are clearly ahead of the curve. Countries like Singapore with Singpass, Malaysia with MyDigital ID, Hong Kong’s iAM Smart, South Korea’s mobile ID, and Australia’s myID have already rolled out strong national digital identity systems. What sets them apart is the deep government backing and the seamless integration of these systems across both public and private sectors—everything from e-government portals to financial services.

At the same time, emerging economies like Thailand, Vietnam, and Indonesia are laying important groundwork for smoother and wider adoption of digital ID—through developing new regulatory standards.

India is a standout example with Aadhaar—its biometric-based system has enrolled over a billion individuals, making it the largest digital ID program in the world. As of October 2024, over 1.383 billion Aadhaar numbers have been issued, covering more than 99.9% of India’s adult population.

The Philippines is also progressing rapidly, having issued at least 84 million digital IDs to date.

Progress is undeniable—but it hasn’t erased the roadblocks. For the more advanced digital economies, the focus has shifted to issues like fraud prevention, system interoperability, and ensuring accessibility for all users—those are real hurdles to achieving full-scale adoption. For emerging markets, the bigger obstacles are around foundational elements like digital infrastructure, consistent government support, and addressing digital exclusion. So while the region is moving forward, the path looks different for each country based on where they are in their digital journey.

THE SUMSUBER: Thank you, Penny. We’ve covered jurisdictions—let’s turn to industries. Can you share which industries in APAC have already adopted digital IDs and which are likely to catch up in the near future? And speaking of momentum, could air travel be next in line for a full digital ID takeover?

PENNY CHAI: I’d say banking and finance have been at the forefront lately. Banks rely heavily on digital identity solutions to meet strict AML/KYC requirements, so adoption here has been rapid. Asia is also a hotbed for digital banks—Hong Kong has eight digital banks and Singapore has five. And the Bank of Thailand has recently approved three major consortia to establish virtual banks, which will likely accelerate the adoption of digital ID even further in the financial sector.

We’re also seeing adoption pick up in e-commerce and online services. Platforms like Shopee and Lazada use digital identity to personalize experiences and protect against fraud. Even dating apps like Bumble and Tinder are implementing biometric ID checks to prevent fake profiles, combat deepfake romance scams, and enhance overall user safety.

Looking ahead, I expect sectors like healthcare, education, and travel to catch up quickly. In healthcare, digital IDs could help verify patient identities and secure medical records, which is especially important as medical identity theft becomes more of a concern. In education, I see potential for digital IDs to verify student credentials and reduce academic fraud. Again, progress in these sectors will depend heavily on government support and policy frameworks.

As per the travel and transportation— this sector is heating up in all the right ways. We’re already seeing pilots in Japan using My Number cards for railway ticketing, and in China, Shanghai’s metro has started trialing palm biometrics.

Overall, airports in Asia are taking a lead globally—Changi Airport, Kempegowda in Bengaluru, and Hong Kong International Airport are all rolling out biometric tech at scale. Different layers of identity data are being used at all air travel stages—from payment verification to passport and biometric checks. This shows how digital identity can play multiple roles across the customer journey.

However, full adoption in air travel won’t happen overnight. There’s still a divide in public perception. Many people love the convenience of faster check-ins, and many still have concerns about data privacy, surveillance, and potential misuse. So it’s important that airport authorities and governments strike the right balance—ensuring efficiency and convenience without compromising trust and data protection. Digital ID in travel is inevitable, but adoption will ultimately hinge on how well we navigate these concerns.

THE SUMSUBER: It seems like if digital ID keeps advancing like this, soon heading to the airport without your passport might just be a minor inconvenience—not a missed flight. Last question from us today. In your opinion, what is the future of digital identity in the region? And what are the key considerations for making digital identity systems effective, secure, and compliant?

PENNY CHAI: I’d highlight one key factor: trust. The success—and future—of digital identity in the region will depend on it. And trust, in this context, is all about how responsibly a platform handles user identity.

When companies can demonstrate that they comply with global privacy laws and maintain strong data and cybersecurity practices, users are far more likely to feel confident in sharing their information. Trust is not solely about AML compliance. Businesses must show users that their personal data is being treated with care and respect.

For digital ID to actually work in the future, we also need to consider transparency and communication. Users need to understand why their identity data is being collected, how that data will be used, and when it will be applied—say, during check-in or check-out processes. This clarity builds confidence and encourages users to engage with the system.

Ultimately, if platforms can combine robust data protection with open, user-friendly communication and clear consent practices, they’ll be much better positioned to earn users’ trust—and with that, accelerate the broader adoption of digital identity across APAC.