Identisys is a market leader for ATM and debit cards for Kenya’s mid-sized banks, and also the leading provider of secure ID systems for the Kenyan and Ugandan government. Andrea Bohnstedt speaks to Raju Chana about this nascent industry in Africa and why cards are not just about money.
Laminated IDs may be cheap, but they are also incredibly easy to fake: Raju Chana, owner of Identisys, a Kenyan company that provides card solutions, mentions a case where robbers literally walked off with cash in transit after they entered the premises with fake IDs. The company only realised that they had given the money to the wrong people when the real guards turned up.
Raju Chana is one of the pioneers in East Africa’s card and ID market: He founded Identisys in 2002 after 17 years in the card industry in the UK and Kenya. At that time, he felt that he had run out of new challenges in his existing career, and spotted an opportunity when he realised that local banks were charged exorbitant rates for cards. Today, Identisys is the leading provider of ATM and debit cards in the Kenyan market, but also the key supplier of secure government IDs.
Solutions for Mid-Sized Banks
The larger banks produce their own cards – Barclays is the largest card issuer in East Africa , but many smaller and medium sized banks use Identisys. The company can only, Chana points out, manufacture credit cards, but cannot personalise them with the client’s name and account number. This has to be done either by the banks themselves or by a certified bureau like De La Rue. Credit cards have not yet reached critical mass in East Africa’s largest economy: Mastercards, for example, are currently all sent to Lebanon because the volumes in East Africa are not high enough to justify the annual USD20,000 fee that is charged by the two major credit card companies, Visa and Mastercard. ATM and debit cards, however, can be personalised by Identisys, and they currently do so for 17 local banks, including the Post Office Savings Bank and EcoBank/EABS. It is with a view to making credit card production viable that Chana’s plans to ultimately expand across the continent.
IDs and National Security
Identisys’ business, however, is not restricted to bank cards. The company represent two of the global industry leaders in the card industry, Fargo and Magicard, in East and Central Africa, so they can produce driving licenses, national IDs etc to international standards, and have become the leading supplier of secure ID solutions to the Kenyan and Ugandan government.
Since the terrorist attacks on the US in 2001, security requirements overall, e.g. in airports, and in specific institutions like the national security forces, have become markedly stricter. Awareness of this global development is not evenly spread throughout the EAC: In Chana’s experience, the Kenyan government ‘has cottoned on’, and Rwanda’s government is not only very tech-savvy, but has the benefit of being able to start from scratch. In the region, Kenya is currently the only country that issues identity cards, a project that has been put on hold again in Uganda reportedly due to the lack of funding. But even in Kenya, there is no centralised system to manage ID records: The Kenya Revenue Authority (KRA) offered to host the data for driving licenses, but currently only has an estimated 20,000 legitimate driving license records.
The absence of reliable identity cards is not only an overall security concern, but also has implications for e.g. the banking sector: In countries like the UK, where IDs are not compulsory, bank clients are asked to provide utility bills, but these are not as widely available throughout East Africa either. In the absence of both national and alternative identification methods, companies are now beginning to with biometric identification: In Uganda, new credit reference bureau Compuscan is in the pilot phase of using biometric data to capture bank client identities (see Uganda: Press Release: Excitement at Banks in Kampala as Credit Bureau Becomes a Reality)
Outlook
Like many other entrepreneurs who introduce new products and services to Kenya, Chana recognises that the market, above all, needs to be educated: While many people are now familiar with ATM and debit cards, few companies are really aware of the potential and benefits of card systems for other purposes – beyond storing cash, making payments, and identifying people, intelligent card systems can also collect data, be used in leisure facilities, for ticketing, to manage memberships, for parting facilities, for IT access, in loyalty schemes, for security purposes, and to measure time and attendance.
Identisys pride themselves on offering complete solutions, from analysing the client’s needs, suggesting a customised solution to implementing, training staff, and providing follow up services: ‘Our niche is end-to-end solutions.’ This does not necessarily have to involve Identisys manufacturing all cards of a client – the company has provided several clients, amongst them all the major security firms in Kenya, with the equipment, security features and training to make and run their secure ID systems. This gives clients full control over their security operations and is more affordable in the long run.
The industry itself is undergoing drastic changes: Magnetic strip cards are now quite widespread, but Chana is eager to demonstrate the advantages of chip-and-pin cards, an ‘intelligent’ technology that effectively puts a mini computer on to the card. Since the verification is done against the information embedded in the chip on the card, it does not need permanent connectivity – an important point in regions where connectivity is often still a challenge. The technology is also infinitely more secure.
He acknowledges that an expensive back-office infrastructure effectively limits the use regions like East Africa, but hopes that a number of smart card pilot projects with regional companies that he hopes will demonstrate to clients how such systems can improve their operations. For Chana, cards have barely begun to scratch the surface of what is possible.
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