With a billion Aadhaar cards issued, it is hard to find anyone who does not have this universal identification (UID) in India. Direct benefit transfer was the initial use of UID; with time its importance has been increasing.

For instance, transactions such as deposits and balance enquiry can be done by customers using Aadhaar-enabled payment services (AEPS). You can move money easily using Aadhaar to Aadhaar funds transfer. There are also cardless ATMs that work on Aadhaar number and fingerprint to authenticate and transact. The Know Your Customer (KYC) process is also simplified with e-KYC through Aadhaar.

Given its prevalence and increasing importance in various transactions, it is important to understand what UID is and what it is not.

Identity proof

The idea of Aadhaar is to be a source of identification for an individual. The government’s UID database has information such as a person’s biometrics — fingerprint and retina scan — as well as photo and name. A person’s UID is unique as de-duplication is done using biometrics during enrolment. So, it can be used to identify a person uniquely. It is a permanent ID, with no expiry date and need not be renewed once you get it.

It cannot however, be used as address proof currently. Also, the ID is given to any Indian resident, irrespective of his/her nationality. So, it cannot be used as a proof of citizenship.

Authorised access

The UID database is secure and access to information is restricted. For one, users have to authorise the UIDAI (the UID Authority of India) by explicit consent through biometric authentication to release their information. Also, only authorised agencies such as Authentication User Agencies and e-KYC User Agencies are allowed to query the database.

Nor is there a risk of biometric data sharing for other purposes. For example, law enforcement agencies cannot perform fingerprint matching using information in the database. The Supreme Court, in 2014, had also directed that biometric data of Aadhaar card holders cannot be shared with any investigating agency.

Also, the database is built in such a manner that when presented with a number and biometrics, the authentication query will only offer a match or no-match response. No other information will be given, thereby ensuring privacy.

To enable banking transactions, you must link your Aadhaar number to your bank account number.

Linking accounts

When a customer seeds the number in the core banking system (bank where he has an account), a link is created with the Institution Identification Number of the bank. This is maintained by the National Payments Corporation of India (NPCI), which routes Aadhaar-based transactions.

When there is an incoming or outgoing money transfer request, a request is sent to the bank linked to the UID. The bank completes the transaction based on the account number that is attached to the number.

What if you have multiple accounts? You can choose to link only one account with the UID. If you have linked more than one, the last account linked will be the one reflected in the database and will be used for transactions. You can check the Aadhaar number mapping status in the NPCI mapper by dialling *99*21# on your mobile phone.

Related Topics