“Aadhaar to help poor save more”

Interview with RS Sharma, Director General, Unique Identification Authority of India (UIDAI)

pratap

Pratap Vikram Singh | December 10, 2012




An alumnus of IIT Kanpur, Ram Sewak Sharma is a 1978 batch Indian administrative service officer belonging to Jharkhand cadre. Sharma is praised for laying down IT infrastructure in Jharkhand. In his role as the director general of unique identification authority of India (UIDAI) Sharma is chauffeuring ‘Aadhaar-enabled service delivery’ which would result in saving huge financial resources to the public exchequer. In an interview with Pratap Vikram Singh, Sharma explains what that service delivery model would be. Edited excerpts:

Can you explain Aadhaar (unique identification number) enabled services delivery model?
We were readying ourselves for the launch of Aadhaar-enabled services delivery on October 20. In the past, we rolled out five pilots or say proof of concepts (POC), starting with wage payment under the Mahatma Gandhi national rural employment guarantee scheme (MNREGS), old age pension and scholarship in Jharkhand. We also did one in Mysore for direct cash transfer in place of LPG subsidy. We did another in Tripura for payment of old age pension. One in Aurangabad in Maharashtra and last one in East Godavary district of Andhra Pradesh, integrating public distribution system (PDS).  
But usually people don’t understand the role of UIDAI in these pilots. Essentially, we have given an identity to people. That is the first part. Then we are also enabling real-time authentication of these identities. Using this micro ATM, which is a mobile phone with a fingerprint device, we can actually authenticate the identity of a person. Thereafter, the service delivery organisations allow the delivery of services because they believe what we authenticate. If I authenticate myself that I am RS Sharma, why will a bank believe? So after authentication they authorise me to transact.
We are playing role of a real-time authenticator thus enabling delivery of services. UIDAI together with line departments will facilitate effective delivery of services to the people.

Many rural areas don’t have telecom connectivity. However, the government is quite upbeat on rolling out Aadhaar-enabled services delivery by 2014. How will you achieve this?
Some of the areas could be completely blank – without a single telecom tower. In those areas, we can take the matter with department of telecom and press for USO funding. That is the only way. But the idea is to go ahead in areas having connectivity.  Then there are line departments who are stakeholders in services delivery who also might pitch in for better connectivity. So this will be a multi-stakeholder approach.

Don't you think ecosystem (e-readiness of line departments and human resource) itself is a big challenge for having identity based delivery system?
One of the essential prerequisites (to use Aadhaar in service delivery) is to digitise beneficiaries’ database.  There are three steps to it. First is digitising the database. Second is seeding the database with Aadhaar. And last is to make a service delivery application. At that point of time we will be able to provide authentication services. So what you are saying is absolutely true that without digitisation of databases the online authentication will not work. From the UIDAI perspective, we have to complete two steps: first is enrol people for Aadhaar and second is authentication. But I think together with line departments UIDAI is putting in place a new model where UIDAI is helping departments in seeding, for example.
What we are creating is a state resident data hub, which will be the database of all residents of state who have got Aadhaar numbers. Now when the state governments digitise their data, for example the digitised PDS data, using the SRDH and PDS data, they can actually seed. So we are trying to create models and framework where seeding the database becomes an easy proposition. We will provide all technical assistance – facilitate them to digitise data and facilitate them to seed the database. Probably we could also provide help in development of applications.

But do you have the bandwidth to do so?
We are having a team of 30-35 people for developing applications. Basically, the team’s job is to promote adoption of Aadhaar and facilitate departments in developing applications. Aadhaar is our product, but how Aadhaar can be used that is something we have to educate to states.  

But given the challenges, will this model be put in place by 2014, as promised by the government?
It is a question of rollout. Once you have proved your proposition, it is just a matter of replicating. In UIDAI, we are ready ourselves and ready to help departments also. If they come forward, we will be there. That is the assurance we gave in the meeting at prime minister's office (PMO).

What is the state of pilot which has been rolled out in 50 districts?
Twenty seven out of 50 districts have more than 70 percent coverage. This figure is one-and-a- half months old. But there are states which are coming up very fast like Rajasthan and Gujarat. Our target is that once you have 80 percent coverage, then 80 percent of every scheme is covered. The residual can be covered at the time of delivery of services. Some people say since Aadhaar number is not there, we can’t do anything. Let us say, if someone comes for getting old age pension, he is told that you first get your Aadhaar number. But the state government being one of the registrars, they can immediately enrol the person and can deliver the benefits based on person's enrollment ID. Thereafter he can be issued an Aadhaar.
On demand enrollment targeted specifically to beneficiaries is possible. Our strategy is to keep 80 percent coverage as minimum (target). Beyond 80 percent, we hope there will be fewer people who will come for Aadhaar. When they come we can make arrangements for them. Mysore has 94 percent coverage. Entire Tripura has 90 percent coverage.

Can you elaborate on direct cash transfer system and the role of Aadhaar?
You see Aadhaar is extremely critical in enabling any cash transfer. There are two steps. First is transfer money in beneficiaries’ account. Here what we are saying is that the government doesn’t need to keep beneficiaries’ account. This will be prone to huge errors. We are saying ‘use Aadhaar as financial address’. It means the government will just give a list that these are my beneficiaries and these are their Aadhaar numbers and the amount against each number. You give this to the bank. Now the bank will figure it out which UID number relates to which account and bank. So this is a two-step process. There is an organisation called national payment corporation of India (NPCI), which has done mapping of Aadhaar numbers and banks. So once this file goes to NPCI, it establishes the relation between Aadhaar and bank and asks to route the money accordingly. It is similar to when you send me an email, the same things gets routed through various hubs. Banks will have Aadhaar number and bank linkage. This is push part of the process, how we push money in beneficiaries account. That is how Aadhaar can be useful in cash transfer.
And if I change my account, I don't need to go to all agencies to get it changed.  If I can just change my entry, now when I had an account with SBI, NPCI mapper was pointing at SBI, now NPCI mapper will point at Bank of India. It ensures account level portability.
But essentially, it facilitates crediting of money in people's account, using Aadhaar as financial address. Second is that it enables opening of bank accounts, since it acts like a standard KYC. Thirdly, for withdrawal, we have created interoperable architecture of business correspondent (BC) network and micro ATM which will ensure that we can have large number of points in rural areas.
Just imagine the transaction volume.  There are 14 crore LPG connections in the country. Government provides for six subsidised cylinders in a year. There are 84 crore subsidy transactions. Which translates to about seven crore a month, it again translates to about 24 lakh per day. There will be huge number of withdrawals also. Similarly, the debit and credit transactions will happen of equal amount. So you need to create that kind of infrastructure in villages through micro ATM. Basically, you create multiple distribution channel based on interoperability so that people have options – whether they should transact with one particular BC or any another BC.

So this will lead do cashless transactions in rural areas too?
See, in cities we carry little cash in our pockets. We carry just one debit card. Why? It is because we have access to money through that card. We can get it whenever we want. In a rural set-up, a villager withdraws all his balance, suppose Rs 500, in one go. Because he knows the second time when he needs money he will again have to waste his one full day to just withdraw money. Now when he knows that a fellow villager has his money and he can withdraw his money whenever he wants, he will start withdrawing lesser money. And withdrawing money from a BC or through micro ATM takes just eight seconds. In contrast, ATM takes relatively more time. This will lead to better savings for the poor.

Reserve Bank of India is coming out with a notification – making Aadhaar work as KYC for opening bank accounts. When do you expect this to come?

Aadhhar is already a KYC. In prevention of the Money Laundering Act, Aadhaar is a sufficient KYC already. RBI will just issue a circular.

What is the idea behind open data initiative of UIDAI?
Confirming to the national data sharing policy 2012, we are putting anonymised data in public domain in machine readable format. This will boost research. Data availability is a big constraint in our country. Machine readable format is one which can be downloaded and you can make do excel sheet and use it in other ways too. But if data is in PDF format, you can just read it, but could not use it that easily. We have actually made some data on enrolment and authentication public. As of now, there are ten data sets available on the portal. We proposed that further we will be coming up with lot of data sets. 250 million people have been enrolled and we have got 100 data points for each enrolment. This is a huge data which can be used for analytics and research purpose.  
For example, if someone is getting enrolled, how much it took for enrollment, how much time did operator gave on which screen, how many attempts made on capturing biometrics. It is called meta data, which is data related to data. So we are capturing that meta data. Suppose, what is the average enrolment time? If someone is doing more enrolments in lesser time why his productivity is better?
Secondly, we use that information to improve our own processes. For example, someone can easily point out that why is it taking more time in capturing biometrics? Then we can figure out why it is taking more time and whether if this can be reduced. If someone feeds us that information, this will lead to big data analysis.

Has the duplication issue between UIDAI and national population register (NPR) been sorted out as the objective of both the agencies remains same – reforming the service delivery processes?  
Yes, it has been sorted out by the cabinet decision which says that 18 states will be done by us and the rest by NPR. And because they have a mandatory process, even though we are working in 18 states, after we have done substantial portion, they will do the residual portion. And the data of the existing one will be given to them as per their requirements. That part has been sorted out. With regard to objective of other agency, I will not be able to comment.

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