The chip certainly solves a lot of problems. It sounds like an iteration of the SIC chip from Sindome.
You could also take a leaf from Tuluk’s handbook and maybe have it as some form of barcode tattoo (Idiocracy reference).
Everyone gets an ID and they choose how they want to display that little thing? Some might like a lanyard, maybe a clip-on, maybe in their wallet or on dog-tags? Could be hounded to have it on display when going around more secure areas (think IRL walking into some places)
I just really like the idea of physical identification, but that’s just my opinion. This does cause more issues than the version of having it be a chip in someone.