New ‘trust’ factor: The impact of Aadhaar in India

One of the undesirable effects of a connected society is the rise in number of Identity theft cases around the world. Thanks to a variety of personal and sensitive information available and accessible online, criminals around the world have a field day committing financial frauds by usurping the identity of ordinary citizens. A record 15.4 million Americans were victims of identity thieves in 2016, according to a study by Javelin Strategy & Research[1]. In India, identity theft accounted for 77% of all financial fraud cases in the first quarter of 2015, according to a report by Experian India[2].

These cases typically involve accessing personal or sensitive data illegally, creating fake documentation, account takeover, and distribution. For victims, the repercussions can be grave and long-lasting – ranging from job or financial loss to litigation. The absence of a tech-enabled surveillance process of the recorded data and poor record keeping has exacerbated the problem, for stealing an identity today is, sadly and surprisingly, a child’s play.

This is where the introduction of Aadhaar for Indian citizens has been truly transformational. A unique identifier for individual citizens, in the form of a 12-digit number, has plugged a big systemic gap towards addressing the rising cases of identity theft. Keeping in account the size of India’s population, a well-designed system like the Aadhaar is an easy and extremely effective way to ascertain the rightful identity of any citizen.

In the month of April, the HRD ministry made Aadhaar compulsory for students to obtain mid-day meal. Within 25 days of implementation, a giant scam was unearthed in the states of Jharkhand, Manipur and Andhra Pradesh, which were earmarking funds under the mid-day meal schemes showing almost 4.4 lakh bogus students in their documents. The three states had been presenting non-existent students on their records to claim false funds from the mid-day meal scheme allocation. In addition to being instrumental in detection of duplicated and false data, Aadhaar has also facilitated a number of rigorous processes like filing tax returns, claiming government assistance, thereby making documentation and identification easier. With over 1.13 billion enrolled members updated on 31 March 2017, Aadhaar is today the world’s largest biometric ID system. As of September 2016, its database, collected the names, addresses and biometric information of more than 105 crore people and offered a unique identity tool to citizens through their fingerprint and iris scan. The biometric ecosystem allows a rapid collection and authentication of the identities.

Use of Aadhaar based KYCalso cuts cost per transaction drastically, from around Rs. 1,000 in the conventional manner to a mere Rs. 30-40 with Aadhaar. According to the Government of India, Aadhaar-linked bank accounts are helping save Rs.15, 000 crores a year in LPG subsidy already. The benefits of Aadhaar are not only limited to the government subsidies and schemes, but also extend to the private sector. The disruptive proposition of Aadhaar has enabled private companies to innovatively use it as a tool for identity verification. For example, it has empowered banks to disburse retail loans with more confidence. Instances such as the rape of a young woman by a taxi driver in 2014 have increased the urgency of conducting an authentic and detailed verification check of the individuals hired on the fly.

By using Aadhaar-enabled verification tools linked to an online database, on-demand companies can keep a check on the criminal history of their employees, partners or vendors. Ultimately, background checks help build trust among businesses and individuals- for they not only verify and corroborate claims with regards to identity and profile, but also reputation (ex: criminal history). Aadhaar has truly been a game changer in this respect. Earlier, individuals were verified manually using physical IDs, reference checks, documents issued by the government, and so on, a process that could take hours if not days.

Using Aadhaar-based checks have made this process a matter of seconds!

Please Note: AuthBridge provides instant ID checks, eKYC and multiple instant verification solutions using Aadhaar capabilities. As a registered AUA with UIDAI, AuthBridge has access to authentic data from UIDAI’s Aadhaar database [1]Source:-

Source: NBC News

[2] Source:-

Source: Experian India Report

 

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