Global businesses lose R30tn ($1.75tn) from untapped economic potential of ‘third largest nation'

The research is part of a new awareness campaign, which introduces the fictional ‘nation’ of Greenflag whose citizens are victims of overly risk-averse business compliance practices and limitations of existing verification systems. These fail to account for a range of diverse identities and appearances and stereotype individuals based on their nationality’s rate of fraud.

"Greenflag may be fictional, but the issue it represents – digital exclusion – is very real, with serious implications. As the digital economy grows, these challenges will only intensify,” says Andrew Sever, CEO and co-founder of Sumsub.

“Our mission is to empower a digitally inclusive future, which is why we decided to dig deeper into the problem. However, we couldn’t realise the true scale of it until we saw these distressing results. Addressing digital exclusion is both a moral necessity and a significant economic opportunity for global businesses and governments. More inclusive verification practices can unlock underserved and underrepresented markets and foster global economic growth, while driving social equity."

Sumsub’s latest research, conducted by Catalyst Group, underscores that digital exclusion is both a societal injustice and an economic oversight. Key findings from the research include:

• Over 627 million people are unfairly excluded from or struggle to access essential digital services.
  
• Greenflag ranks as the third largest ‘country’ in the world, by population.
  
• Greenflag's potential untapped purchasing power stands at $1.75tn.
  
• Digital transactions for Greenflag citizens could exceed $2.46tn by 2028.
  
• Identification document issues – 243 million individuals struggle to access services due to non-standard or outdated ID documents.
  
• Lack of digital literacy – 219 million people are left behind due to insufficient skills to navigate digital platforms. This is due to various factors, including providers neglecting to provide sufficiently accessible support.
  
• Physical appearance changes – 96 million people face verification challenges due to medical conditions, hair loss, facial injuries, or personal decisions like cosmetic surgery and gender transitions.
  
• Country of origin – over 70 million people are blocked by risk-based exclusions, with businesses often generalising entire nations as high-risk, unfairly excluding innocent individuals.

Digital exclusion stems from several barriers, often due to verification systems failing to accommodate the diversity of human experiences. Additional research from renowned institutions like Amnesty International highlights that exclusion can be driven by systemic discrimination and repressive governance, which disproportionately affects marginalised groups. For instance, discriminatory policies, barriers for refugees and migrants, and limitations on freedom of expression prevent many from accessing essential digital services. Additionally, economic instability and inadequate social rights further marginalise vulnerable populations, making it harder for them to engage with digital services.

"We understand the real-world hardships faced by those excluded from digital services, therefore our commitment to tackling this is unwavering. Advanced verification technologies are crucial in supporting governments, digital service providers and firms in verifying and onboarding individuals from diverse backgrounds. We are working to provide the technology that will ensure all people can access the digital economy, and urge our peers to do the same,” added Andrew Novoselsky, chief product officer at Sumsub.

“We are dedicated to offering innovative products, such as non-document verification, to ensure individuals without conventional identification can access essential services. Crucially, we emphasise the need for further collaboration between policymakers, businesses, and verification platforms as this is vital for building a safe and inclusive digital infrastructure."

For the full whitepaper and more information about Greenflag, please visit: https://greenflag.me/