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India’s Biometric ID System Registered 1 Billion People. A Court Just Restricted Who Can Use That Gold Mine of Data

Private companies that used Aadhaar, India’s national identification system, will have to come up with another way to track their customers, the country’s Supreme Court ruled today.

Today’s final ruling weighed in on several contentious uses of Aadhaar, from tying it to new mobile phone registrations to tax IDs.

India’s national ID system is the biggest in the world, serving 1.19 billion residents as of earlier this year, some 93% of India’s population, and consists of a unique number associated with biometric data such as fingerprints, iris scans, and photos. Like Social Security numbers in the United States, Aadhaar numbers were ostensibly issued to streamline delivery of certain state entitlements. But the convenience of a single identification system attracted other players, including India’s tax authorities, security services, and financial tech startups, along with informal criminal networks.

Unlike paper U.S. Social Security cards, Aadhaar consists of a digital record that records each time it is used by a third party to verify someone’s identity. It can also store someone’s address and share it with authorized parties.

Complaints emerged soon after the system began operating in 2010: some government agencies failed to issue benefits to users who lacked an Aadhaar but were otherwise elegible for food aid, for example, and enrollment agents began selling people’s personal details for $8. The country’s law enforcement agencies also pushed for access to people’s Aadhaar records for national security purposes.

Early this year, the Supreme Court began hearings on a set of Aadhaar-related petitions. Today’s ruling by a five-judge bench upholds the Aadhaar Act in general, but clarifies and places new limits on who can use Aadhaar’s data trove and how:

Upheld

  • The overall constitutionality of the Aadhaar Act.
  • The method it was passed (as a speedier money bill rather than a conventional law).
  • Linking Aadhaar to an individual’s income tax identifiers.
  • Requiring Aadhaar to access over 100 types of government benefits.

Overturned

  • Private entities, such as banks and telecom operators, can no longer require Aadhaar numbers for registration and will lose access to the digital Aadhaar system’s application programming interface (API).
  • Sharing of Aadhaar data between government agencies on national security grounds is no longer permitted.
  • Educational authorities cannot require Aadhaar numbers to sit exams or to matriculate.