In a significant policy shift, the Indian government has amended the Aadhaar regulations to permit private entities to use Aadhaar authentication for delivering services. This move, formalized through the Aadhaar Authentication for Good Governance (Social Welfare, Innovation, Knowledge) Amendment Rules, 2025, aims to enhance service delivery by leveraging the Aadhaar infrastructure. However, it also raises important questions about privacy, security, and the balance between innovation and individual rights.
Background: The Evolution of Aadhaar Authentication
Aadhaar, introduced in 2009, is a unique 12-digit identification number issued by the Unique Identification Authority of India (UIDAI) to residents of India. It was designed to streamline welfare distribution and eliminate fraud by providing a robust means of identity verification.
In 2018, the Supreme Court of India struck down Section 57 of the Aadhaar Act, which had allowed private entities to use Aadhaar authentication for their services. The court’s decision was rooted in concerns over privacy and the potential for misuse of personal data. Consequently, Aadhaar authentication was largely restricted to government services and subsidies.
The 2025 Amendment: Key Provisions
The Aadhaar Authentication for Good Governance (Social Welfare, Innovation, Knowledge) Amendment Rules, 2025, notified by the Ministry of Electronics and Information Technology (MeitY), expand the scope of Aadhaar authentication to include private entities. The key provisions of the amendment are as follows:
- Eligibility: Private entities involved in sectors such as e-commerce, travel, tourism, hospitality, and health are now eligible to perform Aadhaar authentication. economictimes.indiatimes.com
- Application Process: Interested private entities must submit a proposal specifying the purpose of Aadhaar authentication and how it serves the public interest. This proposal is to be submitted to the concerned ministry or department of the central or state government.
- Approval Mechanism: If the ministry or department is satisfied with the proposal, it will forward it to the central government to make a reference to UIDAI. UIDAI will then examine the application, and upon its recommendation, MeitY will issue approval for using Aadhaar authentication.
- Voluntary Participation: Aadhaar authentication by private entities is to be conducted on a voluntary basis, ensuring that individuals have the choice to opt-in.
Objectives of the Amendment
The government has outlined several objectives for this amendment:
- Enhancing Service Delivery: By allowing private entities to use Aadhaar authentication, the government aims to promote ease of living for residents and enable better access to services. hindustantimes.com
- Promoting Innovation: The amendment seeks to foster innovation by enabling private entities to leverage Aadhaar authentication for developing new services and solutions.
- Ensuring Good Governance: The use of Aadhaar authentication is intended to improve transparency and inclusivity in the decision-making process, thereby promoting good governance.
Potential Benefits
The amendment could offer several benefits:
- Streamlined Processes: Private entities can utilize Aadhaar authentication to simplify customer verification processes, reducing paperwork and processing times.
- Enhanced User Experience: With quicker and more reliable authentication, customers may experience improved service delivery across various sectors.
- Reduced Fraud: Aadhaar authentication can help in mitigating identity fraud by providing a secure and verifiable means of identification.
Concerns and Criticisms
Despite the potential benefits, the amendment has sparked concerns among legal experts and privacy advocates:
- Constitutional Validity: Some experts argue that the amendment may be unconstitutional and violative of the Supreme Court’s 2018 judgment, which restricted private entities from using Aadhaar authentication due to privacy concerns. m.economictimes.com
- Privacy Risks: Expanding Aadhaar authentication to private entities could increase the risk of data breaches and misuse of personal information, making individuals more vulnerable to fraud.
- Surveillance Concerns: There is apprehension that widespread use of Aadhaar authentication by private entities could lead to increased surveillance and erosion of individual privacy.
Safeguards and Regulatory Oversight
To address these concerns, the following safeguards and oversight mechanisms are proposed:
- Strict Compliance: Private entities must comply with data protection regulations and ensure the security and confidentiality of Aadhaar information.
- Regulatory Oversight: UIDAI, in collaboration with relevant government ministries, will oversee the authentication processes to prevent misuse and ensure adherence to the prescribed guidelines.
- User Consent: Aadhaar authentication must be conducted with the explicit consent of individuals, ensuring that participation remains voluntary.
Conclusion
The 2025 amendment to the Aadhaar regulations marks a significant development in India’s digital governance framework. While it aims to enhance service delivery and promote innovation by allowing private entities to use Aadhaar authentication, it also necessitates a careful balancing act to protect individual privacy and prevent potential misuse. As the implementation unfolds, it will be crucial to monitor its impact and ensure that robust safeguards are in place to uphold the rights and interests of individuals.