Businesses ranging from banks to courier services and fintech companies are now facing trouble in onboarding new customers after the Election Commission (EC) recently cancelled access of the Bangladesh Computer Council (BCC) to the national identification card database.

Previously, the businesses used to avail the verification services from private firm Digicon Global Services, which has a data access agreement with the BCC.

But the BCC itself has now lost access due to the data-sharing deal with third-party company Digicon.

Wahidur Rahman Sharif, managing director of Digicon, reportedly had close ties to the former Awami League regime. Leveraging these political connections, he allegedly secured a deal with the BCC in 2022.

This deal allowed Digicon's identity verification API provider "Porichoy" to access EC data through the BCC.

Although EC data sharing with a third party by a government or statutory body, in this case the BCC, is a breach of law, a Cabinet Committee on Government Purchase even approved a tariff-sharing plan in 2022.

BUSINESSES CRY OUT

The EC's recent decision to bar the BCC from accessing its database due to these violations has brought this issue to the forefront.

Now, Digicon's clients, after facing a complete halt in onboarding new customers, are raising their voices against the legal violations that have led to this situation.

"While we welcome the decision to restrict third-party access to such sensitive data, it should have been implemented with advance notice and in a more coordinated manner to prevent any business disruptions," said Fahim Ahmed, CEO of Pathao, a user of Porichoy's services.

Companies claim that they were directed towards Porichoy by EC officials when they applied for direct NID verification services.

"After obtaining the Payment Service Provider (PSP) licence in April 2023, we applied to the EC for NID verification services in August 2023," Ahmed said. "However, the EC directed us to use the services of Porichoy instead."

An official of online truck hiring platform "Truck Lagbe", requesting anonymity, said that their requests for direct access to NID verification services were intentionally diverted towards Porichoy.

Anayet Rashid, co-founder and CEO of Truck Lagbe, said they are facing challenges due to the halt of Porichoy's services.

"This is a serious service interruption."

Digital financial service provider Nagad is also experiencing similar issues with onboarding new customers.

"Our operations are being severely impacted as we are struggling to onboard new clients," said an official of  Nagad.

Green and Technologies Ltd, a licensed payment service provider, applied for a direct connection with the EC in mid-2022 as the EC's service is cheaper than Porichoy.

However, the company only received its credentials last week and is still awaiting API access.

TIMELINE

In September 2022, the Cabinet Committee on Government Purchase approved the tariff distribution for Porichoy's service fees.

On October 4, 2022, the BCC entered a bilateral agreement with the EC regarding data verification.

Subsequently, the BCC entered another agreement with Digicon Global Services Limited to provide an ID verification service – Porichoy -- to both public and private entities, including global organisations.

On December 20 of this year, the EC disconnected the API provided to the BCC.

REVENUE SHARING MODEL

Of the 100 percent of the fee paid by government, semi-government and autonomous agencies for verification using Porichoy, the BCC will receive 20 percent, the data owner 20 percent and Digicon the remaining 60 percent, according to the model approved by the Cabinet Committee on Public Purchase.

Data owner here refers to the government body that owns the data. For example, the EC in this case owns the national ID card data.

For non-government entities, different service fees apply depending on the service.

From the charges paid by a private entity for basic verification or national identity verification, both the BCC and the data owner, the EC will receive 20 percent from each while 60 percent will go to Digicon.

For biometric verification charges paid by a private entity, a staggering 90 percent will go to Digicon.

Over the years, more than 450 companies have used Porichoy services through Digicon, with a total hit count of 8 crore, generating revenue of Tk 112 crore as of October this year, according to the BCC.

Of this amount, government entities received only Tk 17.88 crore, while Digicon received the remainder. Despite this, Digicon has not paid over Tk 7 crore to the government agencies out of the Tk 17.88 crore, which is stipulated in the revenue sharing model.

The Daily Star attempted to contact Digicon Managing Director Wahidur Rahman Sharif for comment but was unable to reach him.

However, Sharif previously claimed to the newspaper that Digicon provided services without direct access to NID data.