Omidyar Survey Shows Why Aadhaar’s Critics Are Mostly Wrong – And Elitist

A recent survey by Dalberg on the state of Aadhaar, which was funded by Omidyar Network India, should lead us to two conclusions. First, all the scare-mongering by the elite has not deterred the poor and the aam aurat from appreciating its benefits. The survey, which covered 167,000 respondents across India, clearly establishes the fact that Aadhaar has enhanced inclusion substantially.

The second conclusion: despite its ubiquity, the Aadhaar system still has issues to be addressed, issues relating to the remaining exclusions, some related to geographical factors, others to the difficulties in rectifying changes and errors in mobile numbers and addresses, and yet others related to the system not authenticating some beneficiaries for multiple reasons.

While privacy concerns have to be addressed through strong legislation, the big takeout from the survey is that Aadhaar has not only come to stay, but is probably the biggest single innovation done by the Indian state to build state capacity and extend its ability to reach out to the last man with its benefits.

The key insights (read the details here) provided by the survey, with my own comments, are the following.

#1: Aadhaar is now ubiquitous, with 95 per cent of adults and 75 per cent of children now holding the number. Overall, enrolment is over 90 per cent. The 102 million who don’t have Aadhaar live mostly in Assam and Meghalaya, while some are homeless. But if we accept that 75 million of the 102 million are children, clearly the exclusion rate is small. It can be remedied in due course.

Comment: Clearly, despite the fact that Aadhaar is not required for many things, the state has been able to make it seem like it is absolutely necessary by making it the easiest identity and address proof that all agencies accept as valid. For the aam aadmi, it is the easiest identity document that he can access.

The incentive to register children, who anyway have to register again once their finger-prints are more well-defined, is clearly lower than that for adults. The big exclusions from Aadhaar relate to Assam (90 per cent) and Meghalaya (61 per cent), and the former clearly is due to the National Register of Citizens (NRC) process that is still incomplete. It is also not surprising that 30 per cent of the homeless do not have Aadhaar; the surprise is that 70 per cent of the homeless do have the number. This is big success.

#2: The hardest part of Aadhaar apparently is updating records. The survey says that 33 per cent of the people who tried to update their information on Aadhaar found difficulty in doing so, and 4 per cent of people still have Aadhaar with errors. Some 15 per cent have Aadhaar with the right address, but the wrong mobile number. A huge number – 39 per cent – have no linked mobile number.

Comment: The hard parts clearly relate to the gradual winding down of the Aadhaar registration infrastructure after the critical targets for enrolment were achieved. Shifting the process to banks and other intermediaries who don’t derive much income from this added effort means that there are few registration points for people living in faraway places. The 39 per cent who don’t have mobile numbers linked to their Aadhaar can be explained by the fact of lower tele-density in rural areas (57 per cent, according to latest Telecom Regulatory Authority of India data). Wrong numbers relate to the fact of the big churn in the telecom industry in recent years, with many subscribers moving to lower-cost Jio subscriptions after 2016.

The government clearly needs to put in place a larger infrastructure for Aadhaar updations, for once you have a mobile population that moves places and changes phone numbers regularly, updation requirements will only multiply. Distant places can perhaps be helped by putting in place mobile Aadhaar centres, just as we have mobile hospitals and medical services.

#3: Aadhaar has been the greatest inclusion device invented in India. The survey says that nearly half (49 per cent) of the people used Aadhaar to access one or more services for the first time; for 8 per cent, Aadhaar was their first ever official identity; for over 80 per cent, Aadhaar has improved services delivery. With Aadhaar, SIM cards can be obtained in a day, when other forms of identity proof involved more delays.

Comment: These are the most important statistics for all people – policy-makers, critics and analysts. Aadhaar has brought a huge revolution in inclusion, by improving access to ordinary people. The excess criticism of Aadhaar is negated by this fact alone. Also, given its ubiquity, Aadhaar has probably improved ease of doing business for businesses that need to follow know-your-customer (KYC) regulations. Without Aadhaar, the spread of digital payment modes to hundreds of millions of customers would have been impossible.

#4: Exclusion rates are small, but must be addressed quickly. The survey reports that 0.8 per cent were denied benefits due to Aadhaar-related issues, and 1 per cent of MGNREGA card-holders did not get work due to Aadhaar glitches. Some 0.5 per cent of pensioners, and 1.5 per cent of public distribution system users also faced exclusions or denial of benefits. But, on the plus side, some 3.5 per cent of the respondents got their benefits despite Aadhaar failures.

Comment: The exclusions cannot be ignored as too small to matter, for even 1 per cent in India means 1.3 million people. Clearly, there is a case for providing those who were excluded additional methods of authentication, with facial recognition technologies being one way out. Hopefully, the kinks in Aadhaar will be ironed out with the deployment of technology and improved systems.

The interesting number is this: while 92 per cent were satisfied with Aadhaar, even the 67 per cent who were excluded said they were satisfied. Put another way, they were inclined to forgive the state for its lapses, probably because the intention was not exclusion. Aadhaar has provided an identity, and this matters even more than the occasional failure in a small minority of cases.

#5: Does privacy not matter to the aam aurat? Not quite. The Omidyar survey notes that even though 72 per cent of residents appreciate the benefits of Aadhaar, half of them worry about linking it to multiple services. Nearly 90 per cent trust the safety of their Aadhaar data, but 8 per cent worry about the misuse of Aadhaar, and 2 per cent believe that they were denied benefits despite Aadhaar due to fraud.

Comment: The message to government and the people who run Aadhaar is simple: thank you, Sirs, for inclusion. But please fix the bugs, and give us a stronger assurance by bringing in a law to guarantee that our data is safe and will never be misused.

Some provisions to compensate people whom Aadhaar failed would be good politics.