The Aadhaar project 26th February 2013 UIDAI www.uidai.gov.in 1

Structure of the presentation Overall mandate of the Aadhaar Project Aadhaar and it’s potential Direct Benefit Transfer and Aadhaar Concerns and responses

Overall mandate of the Aadhaar project

Context Providing a formal identity proof to millions of residents This identity proof would be a gateway to access services Need to streamline government expenditure – cut wastage and leakage Need for a transparent and accountable system of public expenditure Social inclusion project with a developmental focus

Mandate UIDAI established by an Executive Notification in January 2009 by the Planning Commission To generate and assign Unique ID Numbers to Residents Define usage and applicability of UID for delivery of various services Enrolment – One time activity, to establish uniqueness Online Authentication – Transactional, at delivery of service

UIDAI issues Aadhaar numbers… UID  Unique number  Random number Name Parents Gender DoB PoB Address UID = 1568 3647 6218 Basic demographic data and biometrics stored Standardized identity attributes No duplicates(1:N check) Minimal demographic data collected In simple words, we will enroll everyone with basic identity attributes, ensure that there are no duplicates. We will not collect profiing attributes and we will not maintain transactional records.

… and authenticate IDs online, real-time Authentication - ‘Are you who you claim to be?’ UID = 1568 3647 4958 Our audacious goal is to provide ubiquitous on-line authentication. Authentication to us is simple: Are you who you claim to be? Answer is only yes or no. there is no invasion of privacy. No information is disclosed during authentication. Mandate is simple. How do we achieve it? Central UID database 1:1 check, no ID fraud Only YES/NO response, no details – no invasion of privacy Person can see self-details, no one else can

Where are we today… Started issuing in Sept 2010 28 crore Aadhaars issued so far More than 30 crore residents enrolled Target – 60 crore by 2014

Enrolment centre, Andhra Pradesh

Enrolment Centre, Jharkhand

Enrolment Centre, Puducherry

Aadhaar and it’s potential

Service Delivery potential due to Authentication Transactions normally require verification of identity Aadhaar online authentication will provide a common platform which can be used across all transactions and other applications. Entitlements should reach the intended beneficiary – non-transferability can be ensured This can be effectively done by authentication at the point of service delivery Many sectors will be able to use as a proof of presence for the beneficiary

Empowerment, Choice and Convenience Identity Unique identity to every resident of India which is nationally valid – especially useful for those who have no proof of identity Mobility Aadhaar authentication because of its on-line nature can also be verified anytime, anywhere.  Gateway to Services As Aadhaar can become a KYC for a whole range of products and services (bank accounts, mobile connections, LPG connections, state Govt. services, insurance, etc)

Empowerment, Choice and Convenience Availability of many access points to withdraw benefit make it far more convenient for the intended beneficiary. Auditable and Transparent On-line real time transaction authentication ensures that the entitlements reach intended beneficiary. Choice Interoperable Micro-ATM/FPS network can ensure that the beneficiary has choice. This enhances her/his empowerment.

Aadhaar based government application pilots – Country wide spread Aadhaar Applications in States Scholarships MG-NREGA, Jharkhand Andhra Pradesh PDS Social Security Pensions Maharashtra LPG Subsidy Karnataka Employee Salary Sikkim Old Age Pension Tripura

MNREGA payments through Micro-ATM in Jharkhand

PDS delivery based on Aadhaar Authentication in East Godavari, Andhra Pradesh

Old age pension payment in Tripura

Aadhaar platform for Banking Open Bank Accounts using Aadhaar – Sufficient KYC Existing Bank Account can be linked to Aadhaar number Access Transfer funds to Aadhaar Enabled Accounts Simplifies disbursal of funds – uses only one account for all disbursals – Convenience for the beneficiary Address Withdrawal and deposit, check balance End to end auditability and traceability Inter-operable, portable anytime anywhere Better than local, non-interoperable solutions that limit choice Transactions

? Aadhaar accepted as KYC for… LPG Connections Mobile connections 1 Mobile connections 2 Bank A/Cs, Insurance, etc. 3 ? State Government Services 4 Train Travel 6 5 Many other services…

Aadhaar e-KYC Service “Instant” Opening of Bank Account through a Micro-ATM based on Aadhaar authentication – hugely empowering to the unbanked The Aadhaar e-KYC service instantaneously provides basic data (name, address, date of birth, gender, photograph) of the beneficiary to the Bank upon successful Aadhaar authentication. The e-KYC service can scale up to lakhs of transactions on a daily basis Provides convenience to the unbanked. Enables opening of large number of bank accounts on scale. Ram goes to withdraw cash Explain MicroATM TransferMoney txn, with fingerprint to merchant bank NPCI authenticates the resident using UID, gets bank account using the ID mapper Executes the debit and credit transaction Sends SMS to resident and BC about debit and credit respectively BC gives resident the cash. Any Bank, Any Mobile, Any BC – no hardwiring of components or vendors – thru UID higher level of abstraction MicroATM can perform all txns - Can perform deposits and C2C transfers as well.

Direct Benefit Transfer and Aadhaar

All direct cash transfers into one account Multiple Schemes Aadhaar Payments Bridge One Aadhaar linked account APB Compatible with CPSMS

End-to-End Direct Benefit Transfer Enabled by Aadhaar Pension Bank xxxcccc ----- ----- Radha 111122223333 1111 2222 3333 2. Aadhaar as KYC to open bank account MGNREGA xxxxx yyyyy ----- ----- Radha 111122223333 Aadhaar Payment Bridge 1111 2222 3333 Scholarship 3. Aadhaar as a payment destination - Bank Account portability - Many schemes, one Aadhaar linked bank account xxxxx ----- ----- Radha 111122223333 4. Withdraw from any MicroATM – Choice and Convenience 1. Aadhaar to de-duplicate databases 5. Auditability and traceability of transaction

Micro-ATM transactions Handheld device and battery powered Online connectivity through mobile network Micro-ATM standards set by RBI and IBA (manufactured by multiple vendors) Biometric scanners are certified Interoperable devices and can work for any bank and any BC Total online transaction time less than 15 seconds – Verified on the ground from Tripura, Jharkhand, Maharashtra, and Andhra Pradesh

Convenient cash withdrawal Ram’s bank account Resident 8. Inform: Call / SMS 5. Authorize 6. Debit 1. Withdrawal request 9. Cash 4. Authenticate Interoperable Switch UIDAI 3. Forward to switch 7. Credit Ram goes to withdraw cash Explain MicroATM TransferMoneytxn, with fingerprint to merchant bank NPCI authenticates the resident using UID, gets bank account using the ID mapper Executes the debit and credit transaction Sends SMS to resident and BC about debit and credit respectively BC gives resident the cash. Any Bank, Any Mobile, Any BC – no hardwiring of components or vendors – thru UID higher level of abstraction MicroATM can perform all txns - Can perform deposits and C2C transfers as well. 2. AADHAAR number, money transfer instruction, biometrics BC’s bank account BC with Micro-ATM

Inclusive convenience banking ID mapper Any Bank Resident - Ram UID 2563 8564 4663 8. Info- IVRS/ SMS 6. Debit Any amount 4. Authenticate and execute Ram’s bank a/c 1. Withdrawal request NPCI switch 5. Authenticate Any micro-ATM 7. Credit 9. Cash TransferMoney From UID 2653 8564 4663 To UID 7233 5968 3094 Amount 300 3.NPCI request Any BC 2. Money transfer instruction + biometrics BC (Kirana, SHG, PO etc)) With Micro-ATM UID: 7233 5968 3094 BC’s bank a/c

Components of the benefit transfer system One-time steps: Aadhaar enrolment Bank accounts for every beneficiary and Aadhaar linkage Digitisation and Aadhaar seeding of beneficiary lists Aadhaar e-KYC service Recurring steps: Aadhaar Payments Bridge On-line authentication service Interoperable cash withdrawal points

Concerns and responses

Concerns and responses Exclusion/Denial of Services Focussed enrolment of beneficiaries of schemes Phased Migration to Aadhaar depending on percentage of Aadhaar coverage. In transition phase, no denial of service due to lack of Aadhaar. Adequate measures to get enrolled – Special camps etc. Biometric Exceptions Authentication – Various modes as well as manual override Replaces Public provisioning Aadhaar and Aadhaar enabled direct benefit transfer is only a platform to transfer benefits. It supplements rather than supplants public provisioning and does not necessarily replace it. Strengthens public provisioning by increasing auditability and transparency High Costs The costs compared to the savings (cutting leakages and corruption) to government justifies the project Detailed cost benefit analysis undertaken Total expenditure upto January 2013 is Rs.2369 crore. All expenditure on UIDAI website. Authentication cost would be minimal.

Not pre-requisite for DBT Essential for traceable and auditable DBT Aadhaar serves the purpose of de-duplication, sufficient KYC, a financial address as well as convenient interoperable way of withdrawing money Technology untested Largest biometric database in the world Biometric accuracy of a dataset of more than 8 crore residents conducted Iris and fingerprint technology together provide a high degree of accuracy Biometric exceptions Privacy of Data Minimal demographic data collected Only yes/no response for authentication – no transaction data Sufficient data security practices in place – encryption, anonymization of data Need for Data Privacy law

Issues on the legal status of the UIDAI UIDAI functioning under executive notification issued in January 2009 by Planning Commission Functioning of Authority under executive notification valid under law NIDIA Bill is to strengthen the Authority by giving it a statutory status in order to impose certain obligations and impose penalties

To conclude… The Aadhaar number is a form of empowerment to those who had no proof of formal identity Empowerment is achieved by providing access, choice, empowerment and convenience Government spends large amounts on social welfare programmes

Obligation on State to have the capacity to ensure effective implementation as well as reduce leakage and corruption. The expenditure should reach the intended beneficiary The Aadhaar project is one of the means by which efficient delivery of service and inclusion with access can be enhanced. Not a panacea for all issues of corruption. Large technology projects have costs and risks but the public benefit far outweigh potential risk

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