Have you heard of Aadhar? No, nor me. The name comes from the Hindi for “foundation”, and it’s a cloud-based ID database that holds the details of (at last count) over a billion Indians. When you register with Aadhar, you record your fingerprints, iris scan, name, date of birth, address and gender, and in exchange you are given a unique twelve-digit number which you quote to prove that you are you. Set up initially to enable the payment of welfare benefits to the correct people, Aadhar is now used to check and verify identity in all sorts of environments – including, of course, the wider financial services sector. For the man who led its development, Nandan Nilekani, said from the outset that his invention would be open-access and free to use, for both government and industry. As a consequence, according to the Economist article that alerted me to the existence of Aadhar, “fingerprint readers are a common sight in phone shops, insurance offices, banks and other sellers of regulated products”.
The arguments against a central ID database are many and varied, from concerns about civil liberties to fears of hacking and state corruption. One point that is never made, however, in favour of such systems is the international one. No-one – or at least vanishingly few people – objects to having to produce photo ID (usually a passport) to travel internationally. And to obtain such photo ID, you have to submit your details for verification to a database. Now, if you want to open a bank account or buy an insurance product or take out a mortgage or sell your home, you are launching a transaction into the international financial system. You may not be leaving the country, but your money certainly is, in some form or another. All finance is global now. And so is it really unreasonable to expect your money – through its association with you – to prove its identity before it sets off on its travels?