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Ukraine slashes red tape, saves citizens $12 billion with genius app
Ukraine’s digital transformation approach demonstrates how wartime innovation can streamline governance while cutting costs for citizens struggling with economic pressures.
It offers a potential model for countries seeking to modernize bureaucratic systems without massive infrastructure investment.
Dramatic cost reductions
According to a Telegram post by the Ministry of Digital Transformation, the ministry commissioned research firm Civitta to analyze cost differences between Diia’s 60 most popular services and their traditional offline equivalents.
The government’s calculations show dramatic reductions in time and money spent on bureaucratic processes.
The ministry claims that car sales and registration, used 1.6 million times annually through Diia, cost citizens $132 online versus $1,325 offline. Business registration dropped from $680 to $122, while address registration fell from $624 to $52.
The ministry estimates these savings add up to 49 billion hryvnia ($12 billion) annually across all services.
The government further claims that over five years, the platform has saved citizens 184 billion hryvnia ($4.5 billion) and millions of hours previously spent navigating bureaucracy—though these figures come from the ministry’s assessment rather than independent verification.
Ukraine’s digital governance revolution
Diia, launched in 2020 as Ukraine’s flagship digital platform, functions as what Ukrainian officials call a “state in a smartphone“ application, digitizing over 130 government services.
With over 20 million users, the platform has continued expanding even during wartime, recently adding online marriage ceremonies that Time magazine named among 2024’s best inventions.
Global comparisons reveal Ukraine’s digital ambition
Ukraine’s claimed savings put it in an ambitious company among digital governance leaders.
Estonia, frequently cited as the gold standard for e-governance, reported five years ago through its own government statistics that digital services save over 1,100 working years annually through reduced bureaucratic processing.
According to Estonian officials, their digital voting costs $56 per vote compared to $500 for traditional ballot processing.
Denmark and Estonia currently top the UN’s E-Government Development Index, with values of 0.9847 and 0.9727, respectively (on a scale where 1.0 represents perfect digital governance).
Ukraine’s rapid digitization during wartime suggests the country could challenge these leaders if it maintains development momentum post-conflict.
Funding challenges cloud digital future
Ukraine’s digital transformation faces uncertainty after funding disruptions. In February 2025, the US Agency for International Development initially halted funding for the Ministry of Digital Transformation. USAID had provided at least $40.5 million for projects ranging from Diia development to AI regulation strategies.
However, new partnerships emerged by February 2025, with USAID and UK Development launching a five-year “Digital Transformation Activity” through Eurasia Foundation.
Recent reports from September 2025 still mention the ongoing “suspension of funding from USAID” for specific projects, indicating continued uncertainty.
Switzerland previously committed $68 million in September 2024 to support continued digitization efforts, including e-notary services and humanitarian demining technology.
Challenges behind the success story
The ministry’s self-reported savings figures warrant skepticism, as they rely on calculations by a government-commissioned firm.
The methodology doesn’t account for initial development costs, ongoing maintenance expenses, or infrastructure requirements that enabled the digital transition.
Despite all the challenges, the platform’s user adoption rates and international recognition suggest genuine value for Ukrainian citizens navigating wartime disruptions and traditional bureaucratic obstacles.
