Identity for inclusion: moving beyond aadhaar

Abstract

State intervention in India to expand financial inclusion to rural areas has had an interesting history. It has moved away from building state-led institutions to setting policy that pushed financial inclusion through non-state agencies as well. While identity, de-duplication, and authentication were issues that affected the pace of financial inclusion, they were not the most significant problems to be fixed. By allowing the Aadhaar project to set the discourse on financial inclusion, the State has moved away from the Reserve Bank of India's definition of comprehensive and meaningful financial inclusion towards a model that facilitates transactional aspects, with significant costs added at the intermediary levels.