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Sharing economy to leverage Aadhaar


Two major proponents of the sharing economy, Airbnb and Uber, are considering using the Aadhaar biometric identification database to authenticate their respective users in India.

Aadhaar is the 12-digit unique identification number issued by the Indian government to every individual resident of India. The Aadhaar project aims to provide a single, unique identifier which captures all the demographic and biometric details of every Indian resident. At last count, over 1.1 billion people out of India’s population of 1.27 billion have been registered in the Aadhaar database.

Airbnb, the online marketplace and hospitality service that enables people to lease or rent short-term lodging, including vacation rentals, apartment rentals, homestays, hostel beds, or hotel rooms, is considering using Aadhaar to verify hosts’ identities on its platform in India and is currently testing it with a limited number of users.

Uber, which develops, markets and operates the Uber car transportation and food delivery mobile apps is also planning to use Aadhaar to verify drivers’ identities and collect their demographic data, in order to protect riders. Ola, an Indian startup that offers Uber-like ride sharing services, also plans to make Aadhaar authentication mandatory for all new drivers who sign up to the platform, according to a BuzzFeed news article.

The move to use Aadhaar for consumer authentication is part of the Indian government’s plan towards moving towards a full digital economy that will leverage the biometric registry as a identification and general payments ecosystem for the entire population. Although the Aadhaar scheme was initially launched for the provision of social services, including monitoring school attendance, providing natural gas subsidies to India’s rural poor, and direct wage deposits to bank accounts, the Indian government intends to extend the system to all consumer financial transactions. The trend of the current government is also to continue to extend the scheme for all interactions with citizens.

The continued extension however is creating pause for civil libertarians who believe that the centralized and inter-linked Aadhaar database will lead to profiling and privacy violations that will endanger personal freedom. An article from The Wire notes that industry experts are concerned about Aadhaar being hacked and also about identity fraud and theft surrounding its payment system. Civil libertarians are also expressing concerns about the security issues around the gathering and storage of personal and biometric information.

In contrast, the Indian government argues that Aadhaar has the proper privacy protections in place and empowers people through access to government services and new market opportunities. In an interview published by Moneycontrol, Ajay Bhushan Pandey, Chief Executive Officer of the Unique Identification Authority of India (UIDAI), the agency that manages Aadhaar said the registry “is fully compliant and respects privacy at the highest level… Aadhaar does not know any of your transactions, and if it does not know, there is no question of watching you as a Big Brother. There is no central repository of transactions and no interlinkage.”

He further noted in the article that the system has improved people’s lives since Aadhaar allows for “authentication through mobile phone, through the Internet so people can access various services online without physically visiting. Earlier, many of these services could not have been offered online to everyone.”

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