AADHAAR RELATED ARTICLES: 12925 - The dangers of instant Aadhaar authentication for India's 1-minute loan market

In 2009, I became extremely concerned with the concept of Unique Identity for various reasons. Connected with many like minded highly educated people who were all concerned.

On 18th May 2010, I started this Blog to capture anything and everything I came across on the topic. This blog with its million hits is a testament to my concerns about loss of privacy and fear of the ID being misused and possible Criminal activities it could lead to.

In 2017 the Supreme Court of India gave its verdict after one of the longest hearings on any issue. I did my bit and appealed to the Supreme Court Judges too through an On Line Petition.

In 2019 the Aadhaar Legislation has been revised and passed by the two houses of the Parliament of India making it Legal. I am no Legal Eagle so my Opinion carries no weight except with people opposed to the very concept.

In 2019, this Blog now just captures on a Daily Basis list of Articles Published on anything to do with Aadhaar as obtained from Daily Google Searches and nothing more. Cannot burn the midnight candle any longer.

"In Matters of Conscience, the Law of Majority has no place"- Mahatma Gandhi

Ram Krishnaswamy

Sydney, Australia.

Aadhaar

The UIDAI has taken two successive governments in India and the entire world for a ride. It identifies nothing. It is not unique. The entire UID data has never been verified and audited. The UID cannot be used for governance, financial databases or anything. It’s use is the biggest threat to national security since independence. – Anupam Saraph 2018

When I opposed Aadhaar in 2010 , I was called a BJP stooge. In 2016 I am still opposing Aadhaar for the same reasons and I am told I am a Congress die hard. No one wants to see why I oppose Aadhaar as it is too difficult. Plus Aadhaar is FREE so why not get one ? Ram Krishnaswamy

First they ignore you, then they laugh at you, then they fight you, then you win.-Mahatma Gandhi

In matters of conscience, the law of the majority has no place.Mahatma Gandhi

“The invasion of privacy is of no consequence because privacy is not a fundamental right and has no meaning under Article 21. The right to privacy is not a guaranteed under the constitution, because privacy is not a fundamental right.” Article 21 of the Indian constitution refers to the right to life and liberty -Attorney General Mukul Rohatgi

“There is merit in the complaints. You are unwittingly allowing snooping, harassment and commercial exploitation. The information about an individual obtained by the UIDAI while issuing an Aadhaar card shall not be used for any other purpose, save as above, except as may be directed by a court for the purpose of criminal investigation.”-A three judge bench headed by Justice J Chelameswar said in an interim order.

Legal scholar Usha Ramanathan describes UID as an inverse of sunshine laws like the Right to Information. While the RTI makes the state transparent to the citizen, the UID does the inverse: it makes the citizen transparent to the state, she says.

Good idea gone bad
I have written earlier that UID/Aadhaar was a poorly designed, unreliable and expensive solution to the really good idea of providing national identification for over a billion Indians. My petition contends that UID in its current form violates the right to privacy of a citizen, guaranteed under Article 21 of the Constitution. This is because sensitive biometric and demographic information of citizens are with enrolment agencies, registrars and sub-registrars who have no legal liability for any misuse of this data. This petition has opened up the larger discussion on privacy rights for Indians. The current Article 21 interpretation by the Supreme Court was done decades ago, before the advent of internet and today’s technology and all the new privacy challenges that have arisen as a consequence.

Rajeev Chandrasekhar, MP Rajya Sabha

“What is Aadhaar? There is enormous confusion. That Aadhaar will identify people who are entitled for subsidy. No. Aadhaar doesn’t determine who is eligible and who isn’t,” Jairam Ramesh

But Aadhaar has been mythologised during the previous government by its creators into some technology super force that will transform governance in a miraculous manner. I even read an article recently that compared Aadhaar to some revolution and quoted a 1930s historian, Will Durant.Rajeev Chandrasekhar, Rajya Sabha MP

“I know you will say that it is not mandatory. But, it is compulsorily mandatorily voluntary,” Jairam Ramesh, Rajya Saba April 2017.

August 24, 2017: The nine-judge Constitution Bench rules that right to privacy is “intrinsic to life and liberty”and is inherently protected under the various fundamental freedoms enshrined under Part III of the Indian Constitution

"Never doubt that a small group of thoughtful, committed citizens can change the World; indeed it's the only thing that ever has"

“Arguing that you don’t care about the right to privacy because you have nothing to hide is no different than saying you don’t care about free speech because you have nothing to say.” -Edward Snowden

In the Supreme Court, Meenakshi Arora, one of the senior counsel in the case, compared it to living under a general, perpetual, nation-wide criminal warrant.

Had never thought of it that way, but living in the Aadhaar universe is like living in a prison. All of us are treated like criminals with barely any rights or recourse and gatekeepers have absolute power on you and your life.

Announcing the launch of the # BreakAadhaarChainscampaign, culminating with events in multiple cities on 12th Jan. This is the last opportunity to make your voice heard before the Supreme Court hearings start on 17th Jan 2018. In collaboration with @no2uidand@rozi_roti.

UIDAI's security seems to be founded on four time tested pillars of security idiocy

1) Denial

2) Issue fiats and point finger

3) Shoot messenger

4) Bury head in sand.

God Save India

Sunday, March 4, 2018

12925 - The dangers of instant Aadhaar authentication for India's 1-minute loan market - Money Control

Mar 01, 2018 02:35 PM IST | Source: Moneycontrol.com

The dangers of instant Aadhaar authentication for India's 1-minute loan market

A major fin-tech scam is on the cusp of emerging in India's instant loan startups space. The case below could be a precursor to it….

Harsimran Julka

I was talking to a few students who had filed a complaint with the Delhi Police against a coaching institute, which was working in tandem with an instant loans startup backed by some venture capital investors.

The students are not complaining on the methodology of their teaching but on the way the coaching institute is extracting money from the students and their parents.

The main culprit behind the whole ‘fraud’ that students claim is the Aadhaar’s Instant Authentication System. The system is being used to extract money from a student or parent’s bank account even before ‘they have agreed to be enrolled in the course or negotiated on the fee’.

Here is how it works. The student walks into the coaching institute. The institute asks them to bring their Aadhaar card for registration and a finger print authentication on an app. The coaching institute also asks for a signature on a sheet where its written ECS Mandate.

Harsimran Julka
Editor, Startups|Moneycontrol.com

The students are apparently told that they would be given a loan only if they agree to being enrolled after attending a few ‘demo classes’.

But lo an behold! Within 24 hours, the students are sent a loan agreement letter on their email id by an NBFC.

The agreement says that they have taken a loan and upon their request, the amount has been paid to the institute. After a class or two, when the students find they are not interested in the course, the NBFC says that the money for the entire year has already been transferred to the institute’s bank account.

And the institute is unwilling to refund the money.

From the next month onwards, the EMI starts getting debited from a student or their parent’s bank account even though the student is not enrolled in the institute or attending its classes.

To stop the EMIs, the the students filed an FIR. That’s how they approached the Delhi Police, and Moneycontrol.

Since the matter in under investigation, Moneycontrol is withholding the name of the NBFC.

Extrapolating the same scenario, the fraud has a likelihood of emerging in various sectors, including retail (when you buy a TV, fridge or washing machine).

The fraud can also unfold the other way round, a CEO of a lending company, which has raised over USD 50 million, told me.

“There could be students who may be acting in connivance with a coaching institute. While the students may pocket Rs 10k-Rs 20k, by getting instant loans granted against their Aadhaar, the coaching institute can flee by pocketing a lot of money within a few weeks. The government has to be really cautious on this and so are we,” he told me on condition of anonymity.

In approving these loans, the NBFCs hardly ask for any credit history proof or the ITR returns to showcase the financial history of the borrower.

The other flip side to instant loan fraud is likely to emerge in the merchant and sellers market. Loans could be approved against the names of staff members of a shop or trading firm and the proprietor could defraud NBFCs by the millions.

However lending startups told Moneycontrol on anonymity that getting back to the same ‘cumbersome’ process of paperwork before a loan gets approved would kill this emerging market.

“Yes a few bad apples will spoil the party. But we should not throw the baby out of the bath water,” said CEO of a Bangalore based lending firm.

Another impact investment firm that has invested in such lending startups told me on the sidelines of Fintegrate Conference 2018, this week that Aadhaar being one of the largest personal databases in the world is not a startup anymore. “It’s an emerging space which has a lot of potential for those who were never financially included or had a credit history,” she said.

The fault also lies on the part of UIDAI. “Every week, we see a patch being issued from the Aadhaar technology team. Clearly, Aadhaar should not be open to all and sundry,” CEO of a payments firm said.

For the students who are paying the loan even without studying in the institute, clearly the NBFCs should take proper authorisation before transferring the amount to their intermediary sales agents.(This is an opinion piece. Views expressed are personal)