{"id":17233,"date":"2016-11-18T02:20:22","date_gmt":"2016-11-18T07:20:22","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/uidai-building-the-aadhar-for-digital-india\/"},"modified":"2016-11-18T02:20:22","modified_gmt":"2016-11-18T07:20:22","slug":"uidai-building-the-aadhar-for-digital-india","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/uidai-building-the-aadhar-for-digital-india\/","title":{"rendered":"UIDAI: Building the AADHAR for Digital India"},"content":{"rendered":"

 <\/p>\n

Historically, India has been a nation where data has been scarce and unorganized. So, when in 2010 the government mandated UIDAI to launch Aadhar to give a digital identity to every citizen and build a stack of services around it, creating in the process the world\u2019s largest electronic database, it was a watershed moment in Indian history.<\/p>\n

Overview<\/strong><\/p>\n

Simply put the Aadhar card is an SSN on some serious steroids. Four things happen whenever an Aadhar card gets issued:<\/p>\n

\"Details<\/a>
Details about Aadhar being publicized through newspaper advertisements<\/figcaption><\/figure>\n
    \n
  1. A 12 digit number (Aadhar Card) is\u00a0provided and\u00a0detailed information of the individual including Biometric signatures (fingerprint, iris scan) is captured<\/li>\n
  2. All information is digitized and stored in a digital locker. This locker can also be used to store other critical information eg. Education transcripts, bank statements etc<\/li>\n
  3. A bank account is simultaneously created for the person concerned<\/li>\n
  4. Going forward, all data related to the individual gets linked to his\/her Aadhar number<\/li>\n<\/ol>\n

    Further, what makes Aadhar groundbreaking is that it achieves 4 key objectives:<\/p>\n

    1) On Demand Identity authentication and information sharing<\/strong><\/p>\n

    \"Aadhar<\/a>
    Aadhar enables remote authentication and identity management<\/figcaption><\/figure>\n


    \n<\/strong>Aadhar sets up a digital signature, a digital locker as well as digital identity for every person. So now, an individual can authenticate his\/her identity, share critical information as well as approve any business agreement remotely! All that is needed is a simple fingerprint and iris scanner and sitting at home he\/she can share digital biometrics with any individual\/organization. They in turn can \u2018ping\u2019 the central UIDAI database to verify identity. They can also be granted temporary locker access to verify documents and finally the digital signature can be impressed on any agreement the parties agree to.<\/p>\n

     <\/p>\n

    \"Illustration<\/a>
    Illustration of how UPI works and its benefits<\/figcaption><\/figure>\n

    2) Seamless financial inclusion and regulation
    \n<\/strong>40% of people in India do not have access to formal banking channels. 90% do not have access to credit. >80% of transactions on Amazon.in are cash on delivery. And there are estimates ranging from 30% to upto 50% of a prevalent shadow economy which operates unaccounted for in cash. Aadhar seeks to solve these problems in a digital way. Everyone gets a bank account when they get an Aadhar card. Moreover, digital authentication paves the way for a Unified Payments Interface (UPI) (think Venmo but linked to identity not a bank). Also, transactions now get linked to a single identifier thereby ensuring better collation of financial data. Finally, all this financial data builds history and ensures access to credit for the smallest of businessmen.<\/p>\n

     <\/p>\n

     <\/p>\n

    \"Direct<\/a>
    Direct benefits Transfer for LPG<\/strong><\/figcaption><\/figure>\n

    3) Direct Benefits Transfer<\/strong><\/p>\n

    India dishes out hundreds of billions of dollars in subsidies every year in food (Public Distribution System), energy(LPG, Petrol, Diesel), electricity(for farmers and industries), industry(tax breaks) and education(scholarships). Managing these for 1.3 Billion people is no ordinary task. Aadhar has enabled the government to roll out what is called Direct Benefits Transfer (DBT). Basically, now the subsidy\/benefit can directly be transferred to the Aadhar linked bank account of an individual and accessed by them. This prevents leakage and massively simplifies management overhead.<\/p>\n

     <\/p>\n

     <\/p>\n

     <\/p>\n

    4) Platform for Digital India<\/strong><\/p>\n

    Aadhar builds the platform for digital information sharing. Theoretically any and every transaction can be facilitated through Aadhar. Already innovative use cases are emerging \u2013 attendance management, SIM card management, e-governance, administrative feedback, crime records management, electronic voting. Going forward, the possibilities are endless.<\/p>\n

    \"digital-locker\"<\/a>
    Aadhar enables document management and sharing through digital lockers<\/figcaption><\/figure>\n

     <\/p>\n

    Challenges and the road ahead<\/strong><\/p>\n

    UIDAI faces several challenges for Aadhar.<\/p>\n