The Unique Identification Authority of India (UIDAI) has announced significant changes to the Aadhaar Authentication for Good Governance Rules, expanding authentication services to private entities beginning in 2025. The amendment enables both government and non-government organizations to use Aadhaar authentication for services across multiple sectors, including e-commerce, travel, tourism, hospitality, and healthcare. The expansion builds upon India’s broader digital identity initiatives, which include the upcoming launch of an enhanced Central KYC Registry in 2025.
Under the new framework, entities seeking to implement Aadhaar authentication must submit proposals through a dedicated portal, justifying their implementation based on four specific purposes: using digital platforms for good governance, promoting ease of living for residents, preventing dissipation of social welfare benefits, and enabling innovation and knowledge spread. The requirements mirror recent developments such as Karnataka’s implementation of AI-powered Aadhaar authentication for educational applications.
The UIDAI will examine applications and provide recommendations, with concerned ministries or departments reviewing proposals before granting approval. The amendment emphasizes maintaining robust privacy and security standards, with regulatory oversight ensuring private entities’ compliance with established protocols. The security focus comes as India strengthens its digital infrastructure, including new measures to combat telecom fraud.
The development follows a complex legal history regarding private sector access to Aadhaar authentication. In 2018, the Supreme Court of India struck down Section 57 of the Aadhaar Act, which had previously allowed private companies to use Aadhaar-based KYC. However, since 2019, the government has gradually permitted select private entities, particularly in the financial sector, to conduct Aadhaar-based authentication.
Several companies have already begun implementing Aadhaar-based verification services. LinkedIn introduced an Aadhaar-enabled identity verification feature for Indian users in 2023, while financial institutions such as Amazon Pay (India) and Hero FinCorp Limited have received authorization to use Aadhaar authentication for KYC purposes. The expansion coincides with India’s plans to mandate biometric authentication for SIM card registration in 2025, demonstrating the government’s comprehensive approach to digital identity verification.
The amendment represents a significant expansion of Aadhaar’s utility in both public and private sectors, with the stated aim of enhancing service accessibility and reducing bureaucratic processes for residents while ensuring secure transactions between service providers and users. The development is part of India’s larger strategy to create a robust digital identity ecosystem that supports both government services and private sector innovation.
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