South Africa’s Department of Home Affairs (DHA) is rolling out a significantly upgraded identity verification system on 1 July 2025, marking a pivotal moment in the country’s digital transformation journey. Alongside the launch, the department has announced a dramatic increase in the cost of ID verification services – raising eyebrows across the public and private sectors.
For South African tech watchers, this development is more than a pricing story – it’s a case study in how digital infrastructure, cybersecurity, and public service delivery intersect.
Since 2013, Home Affairs has offered an Online Verification System (OVS) that allows banks, insurers, mobile operators, and other third parties to verify client identities against the National Population Register (NPR). The cost? A mere 15 cents per real-time verification – a rate that hadn’t changed in over a decade.
That’s about to change. From July, the cost of a single real-time verification will jump to R10, a staggering 6,500% increase. The department argues that the previous pricing model was unsustainable, leading to system abuse, underinvestment, and failure rates exceeding 50%.
The new OVS is not just a facelift – it’s a full-scale modernization. According to the DHA, the upgraded system now delivers real-time performance with failure rates below 1%, a massive improvement over the previous version.
Key features include:
- Real-time verification with sub-second response times
- Batch verification during off-peak hours at a reduced rate of R1 per transaction
- Improved system resilience, reducing the notorious “system offline” errors at Home Affairs offices
- Enhanced security protocols to protect against identity fraud and data breaches
This overhaul is part of a broader effort to modernize South Africa’s digital identity infrastructure and improve service delivery across government and private sectors.
For fintechs, banks, and mobile service providers, the new pricing model introduces a cost-reflective structure that may impact operational budgets. However, the improved reliability and speed of the system could streamline Know Your Customer (KYC) processes and reduce fraud-related losses.
The DHA also hopes the changes will incentivize responsible usage, especially by large institutions that previously overwhelmed the system with excessive queries.
Home Affairs Minister Leon Schreiber framed the upgrade as a matter of national security and financial inclusion. By ending what he called a “decades-long de facto subsidy” for private institutions, the department aims to ensure that the NPR is sustainably funded and technologically robust.
The move also aligns with South Africa’s broader push to exit the Financial Action Task Force (FATF) grey list, by strengthening identity verification and anti-fraud mechanisms across the economy.
