On January 31, the Ministry of Electronics and Information Technology (MeitY) announced revisions to the Aadhaar Authentication for Good Governance (Social Welfare, Innovation, Knowledge) Rules, 2025. These amendments allow both public and private organizations to integrate Aadhaar-based authentication into their operations, provided their services align with the public interest. The government states that this update is designed to improve identity verification processes and ensure smoother service delivery across various sectors.
One major change in the updated framework is the removal of a rule that previously linked Aadhaar authentication to preventing financial fraud. This revision broadens the scope of verification, allowing more businesses to use Aadhaar data for customer identification. The Unique Identification Authority of India (UIDAI), the agency overseeing Aadhaar, will continue to manage the authentication system.
The scale of Aadhaar’s use has grown significantly.
Government records indicate that Aadhaar authentication was conducted in nearly 130 billion transactions by January 2025, a sharp increase from just over 109 billion transactions the previous year. With the new regulations, companies wishing to adopt Aadhaar authentication must submit detailed applications outlining their intended use. These requests will be reviewed by the relevant government department and UIDAI before receiving approval.
Despite the government’s assurance that all applications will undergo strict scrutiny, critics argue that the review process lacks clarity.
Kamesh Shekar, a policy expert at The Dialogue, a technology-focused think tank, has called for more transparency regarding the criteria used to assess these requests. He pointed out that the Supreme Court has previously raised concerns about potential misuse of Aadhaar data.
These concerns stem from past legal challenges to Aadhaar’s use. In 2018, the Supreme Court struck down Section 57 of the Aadhaar Act, which had previously allowed private entities to use Aadhaar for identity verification.
A later amendment in 2019 permitted voluntary authentication, but that provision remains contested in court. Now, with an even broader scope for Aadhaar verification, experts worry that insufficient safeguards could put citizens’ biometric data at risk.
While the expansion of Aadhaar authentication is expected to simplify verification for businesses and consumers, the ongoing debate over privacy and data security underscores the need for stricter oversight.
As Aadhaar continues to evolve, ensuring a balance between convenience and personal data protection will be crucial.
