India Heads for Biometric Payments
Posted 14.03.2017 Matthew Taylor
The Aadhaar identification system in India is very close to introducing biometric payments. Aadhaar Pay could help make payments incredibly simple for more than a billion people. But the last couple of months have not been completely plain sailing for the Aadhaar initiative.
The Aadhaar biometric identification system is run by the Unique ID Authority of India. The system was introduced to help tackle the huge logistical and bureaucratic challenges of running a country with such a huge population and such disparate levels of income and access to services.
And it has in many ways succeeded. It’s helped to identify and register huge numbers of the Indian population previously considered un-documentable. Just as importantly, it’s helping to deliver basic government services and rights. But since achieving its original mandate, the Aadhaar system has started to be incorporated into all different kinds of services, and it has to be said with varying degrees of success.
The new payment system looks, on paper, like one that could prove to be another success for the system though. Merchants can download an app to android devices that then allows them to deliver biometric payments. A POS system can cost easily more than Rs 5,000, whereas a scanner to make the Aadhaar system work can be acquired for Rs 2,000.
And on the other side of the transaction, customers don’t need anything other than their fingerprint, and their Aadhaar number linked to their bank. They can then pay for goods and services with a simple finger scan, which also avoids the extra charge associated with debit and credit card payments at a POS in India.
With solutions like this, India is using biometrics on a scale not seen or attempted anywhere else in the world. We know, here at BioStore, all about the benefits biometrics can bring to schools and organisations first hand. But can benefits scale and translate reliably and securely into a solution serving more than a billion people for a number of different services. That’s what India is trying to find out, and it is unsurprisingly throwing up some challenges.
For example, one Indian citizen has mounted a legal challenge against private telecom operators using Aadhaar biometric data when the law states they only have the right to use the personal identification number part of the system.
There’s also been criticism that the government funded Mid-day meal programme, which provides free meals to school students at government backed schools, is moving towards requiring the use of the Aadhaar biometric system to qualify. In the solutions, we provide at BioStore, there is always an alternative to biometrics and always the chance to opt-out. Should Aadhaar or any biometric system ever be compulsory?
A biometric system on this scale was always going to run into some resistance and face challenges when it is used in ways people might not expect, approve or want to join. The Unique ID Authority of India is finding out that it is a real challenge to try to integrate the solution on such a large scale, and with so many partners, without running into a series of potential road blocks.
India has implemented a very interesting biometric system, that has no doubt brought benefits to a huge swathe of people. But can the system be stretched into so many different areas without meeting massive resistance? Only time will tell.