The House Always Wins in India: 5.5B eKYC Transactions Done with Aadhaar

For the first time, the house always wins is true for India’s banking industry. As of May 30, 2018, over 5.5 billion eKYC transactions have been performed using Aadhaar. And Aadhaar Bridge is one of the online services that make it easy for companies to access the Aadhaar National ID system to build delightful online experiences in the financial services industry. Aadhaar Bridge offers services through online APIs for conducting authentication and eSign transactions. Aadhaar authentication comes in three forms:

  • Biometric Authentication: Uses the resident’s fingerprint or iris along with the Aadhaar number to verify the person’s identity.

  • Demographic Authentication: Uses the resident’s Aadhaar number and demographic details such as name, address, gender or DOB to verify the person’s identity.

  • OTP Authentication: Uses the resident’s Aadhaar number and an OTP sent to the resident’s registered mobile number to verify the person’s identity.

Source: Aadhaar Bridge

There are other options for trying Aadhaar eKYC APIs such as Signzy, eMudhra, AuthBridge Research Services, Handy Online Solutions, Quagga Tech, Digiotech Solutions, and Syntizen Technologies.

Source: UIDAI

The Aadhaar system provides single-source online identity verification across the country for residents. Once residents enroll, they can use their Aadhaar number to authenticate and establish their identity multiple times using electronic means. It eliminates the hassle of repeatedly providing supporting identity documents each time a resident wishes to access services such as opening a bank account, obtaining a driving license, etc.

Aadhaar authentication and eKYC services are available to different sectors of the industry ranging from banks, insurers, public service companies (government), passport offices, airports, depository participants, payment gateways, and more. By providing a portable proof of identity that can be verified through Aadhaar authentication online anytime, anywhere, the Aadhaar system enables mobility to millions of people who migrate from one part of the country to another.

A number of banks in India are relying on digital-friendly ways to verify identities of their customers and authenticate them for account use. Aadhaar is the most ubiquitous system used right now in the country, with many adding additional layers such as OTP or biometrics. Those include:

  • digibank by DBS (uses Aadhaar + fingerprints for authentication)

  • IDFC Bank (Aadhaar + fingerprints)

  • Kotak 811 (Aadhaar, PAN card + OTP)

  • SBI Yono (Aadhaar, PAN card + OTP)

  • Axis Bank (Aadhaar + OTP)

  • ICICI Bank (Aadhaar + OTP)

  • RBL Bank (Aadhaar + OTP)

  • CANDI by Canara Bank (Aadhaar + fingerprint, iris scan, OTP)

Between June 2017 and end of May 2018, the number of total biometric authentications reached close to 13.6 billion, with the vast majority – ~13.1 billion – in fingerprint authentications, and only 450+ million in iris authentications.

Source: UIDAI

Aadhaar is the only program of its kind globally. It’s a state-of-the-art digital ID that is provided free of cost on an unprecedented scale. The Aadhaar profile includes demographic information (name, date of birth (verified) or age (declared), gender, address, mobile number (optional) and Email ID (optional)), and biometric data (10 fingerprints, 2 iris scans, and facial photograph). Interestingly, the total demographic authentication transactions are nowhere close to biometric: 5.5+ billion vs close to 13.6 billion.

Source: UIDAI

In the past couple of years, India’s economic and business environment has shown great acceptance and potential for a FinTech revolution, digital-first experiences being a part of it. There is a huge top-down push from the government for the adoption of digital solutions and exciting innovations such as UPI, Aadhaar for eKYC, BharatQR for QR-based payments, biometric payments (AEPS), e-wallets by 50+ banks, payment banks, sound-wave-based payments for rural engagements and last mile connectivity. These innovations highlight the fact that India is carving out a niche for itself in low-cost, large-value FinTech-driven innovation focused on urban and rural segments alike.

But what’s most interesting about India is that for the first time, there is an alternative to Western operating systems, creating a situation when the house always wins. UPI and Aadhaar underline financial experiences with any institution, and whatever happens at a customer touchpoint – the state always wins. It wins from the adoption of ‘digital everything’ experiences and creates a digital economy of unmatched scale and efficiency.