The present invention relates to a system and a method of verifying the identity of an individual by employing biometric data associated with the individual (603), wherein privacy of said biometric data (X, Y) is provided. A helper data scheme (HDS) is employed to provide privacy of the biometric data. The present invention is advantageous for number of reasons. First, processing of security sensitive information is performed in a secure, tamper-proof environment (601, 604, 606) which is trusted by the individual. This processing, combined with utilization of a helper data scheme, enables set up of a biometric system where the biometric template is available in electronic form only in the secure environment. Moreover, electronic copies of the biometric templates are not available in the secure environment permanently, but only when the individual offers her template to the sensor.