Aadhaar & mobile can be used effectively for pension, insurance services: UIDAI CEO Saurabh Garg

Aadhaar is an identification that cannot be stolen, lost or destroyed.

The Aadhaar and mobile ecosystem in the country can be effectively leveraged for offering pension and insurance services in a safe and transparent manner, just like the JAM trinity (Jan Dhan, Aadhaar and Mobile), which is now being used to provide benefits through 300 government services and has clocked 773 crore transactions in FY21, UIDAI CEO Saurabh Garg said on Thursday.

Aadhaar is an identification that cannot be stolen, lost or destroyed. Over time it has become nationally acceptable. The JAM trinity now has over 300 schemes and has emerged as a safe and transparent way to deliver benefits to the people, Garg said at a capital markets conference by industry association, Ficci.

“Where do we go from here? The ability of Aadhaar to provide the all inclusive and verifiable KYC, which is essential for the financial sector, is really where the benefits will come going forward,” Garg emphasised.

For instance, in the banking sector, out of the 124-125 crore Aadhaar cards, around 73 crore are linked to a bank account. Out of the 140 crore bank accounts, around 120 crore accounts are already linked with Aadhaar and that explains the growth of the Aadhaar payment bridge and the AEPS, he noted.

“In insurance and pension products, there is no reason why there cannot be for example, Pension Aadhaar Mobile just like JAM. Given the near universal penetration of Aadhaar and even of mobiles to a great extent, the combination is where I think the investment side, the pension side and the insurance side, can work. We would be very happy to work on how this can be expanded,” Garg said.

UIDAI is doing 4 crore authentications per day of various kinds whether it is e-sign, KYC, etc, he added.

Aadhaar Enabled Payment System (AEPS) transactions grew 66% y-o-y to 392 crore in FY21 compared to 236 crore transactions in FY20. The benefits are huge for the people as they can do transactions on AEPS run by the NPCI and backed by the Aadhaar system, Garg pointed out.

Direct cash transfers are another great example of Aadhaar’s usefulness, transparency, efficiency and the time of implementation. It has checked leakages in government schemes. In just the five flagship schemes like PDS, PM Kisan and LPG subsidy, it has helped save around Rs 1.80 lakh crore over the past 4-5 years. That is the kind of savings that the DBT mechanism based on Aadhaar has had, he said.