FE Data Special: Despite hitting billion mark, Aadhaar still has long way to go

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Updated: August 11, 2016 4:37:22 PM

The biggest success of Aadhaar has been seen in DBT in LPG.

While it is indeed laudable that Aadhaar enrolment has crossed the 1-billion mark, and Parliament has passed a legislation giving statutory status to the unique identity project, much will now depend on how quickly these cards are seeded with bank accounts for targeted payouts of government subsidies, linked with election cards to stamp out bogus votes or linked with passports and other services.

The biggest success of Aadhaar has been seen in DBT in LPG. The government has been able to save Rs 14,672 crore as the scheme reduced leakages by 24% by weeding out fake accounts. The onus is now on states to link Aadhaar with PDS beneficiaries as the government has been able to save Rs 2,346 crore with just four states adopting Aadhaar-based transfer. Though the total number of transactions on the Aadhaar Payment Bridge was 94.71 crore, worth Rs 28,363 crore—a substantial increase from Rs 4,474 crore clocked in May 2014—the disbursal is still far below the potential.

Going forward, the government can save a substantial amount by using Aadhaar-based identification for all its social security schemes like pension, scholarships and subsidies including fertilisers and food. Using the UID number, the government can carry out proper authentication of beneficiaries and ensure benefits reach directly to the people.

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