By Michael Daubert

India is beginning to change the way businesses operate by offering the world’s largest biometric-identity database for businesses such as tech firms, health-care providers, and novice app developers to use. This is a huge jump into the digital future because their government is gathering digital-identification records from billions of citizens in an attempt to standardize the ways that people exchange data digitally. This is then used to facilitate the transfer of signatures and official documents that citizens need to get jobs, make financial transactions, or to access government services. As a result, this will allow people to sign up for insurance, invest in mutual funds, receive health-care subsidies and verify their identity for school examinations by using iris and fingerprint scans from their mobile devices. According to Bill Gates, who is the founder of Microsoft Corp, “India’s decision not only to form a digital identification pool but also to promote its integration with private commerce and services could help create the world’s most digitized economy” (Stacey). This is due to the fact that this is “something that has never been done by any government before, not even in a rich country” (Stacey). The government is attempting to give cashless commerce a huge push this year by withdrawing large denomination banknotes from circulation, which means they are attempting to prompt a sharp rise in the use of mobile payments apps and tax the people who have dodged paying taxes all together. The project is known as “India Stack” and analysts predict that India’s financial technology sector alone will increase from $2 billion to a $600 billion industry by 2026.

Furthermore, many tech incubators and investors are trying to get a jump on the opportunities that India Stack is offering because they know it could completely change the way businesses operate. For example, people see this new technology as a way to boost school attendance, prevent examination fraud where surrogates sit in for test takers, allow individuals to provide their health records to any hospital or pharmacy, to sign up for health-insurance plans, and open mutual funds with a simple finger scan on their smartphone. India is really trying to change society by creating a presence-less, paperless, cashless society.

However, some people do not see this happening in the United States because they view this approach to be both innovative and very risky. As a result, many people say that digital commerce in the United States is actually being held back by privacy concerns about biometric verifications as well as by banks, brokers, and other incumbents that resist change. In addition, such efforts in the United States have not gone beyond the use for passports and IDs used in the military because it generated a lot of backlash over civil liberties and state surveillance. Despite this fact, India’s government disagrees with this theory and argue that their government worked with the financial regulator as well as the largest state banks in order to develop a universal payment system. However, the process seems like it would take a lot of time for other countries to implement because the government would need to scan the fingerprints and eyes of every person in the United States. In fact, India’s project cost their government roughly $1.2 billion and they spent over five years scanning the fingerprints and eyes of over one billion people, which to me, seems very costly and inefficient.

In addition, some critics of India Stack have a huge issue with bringing private-sector developers into the government in order to build the system. They strongly believe that the digital platforms and services should be purchased through a procurement process that is subject to the country’s comptroller. Furthermore, people are beginning to worry that the system could be hacked, which would compromise citizen’s privacy as well as government operations. It could also be used to track and suppress India’s poorest and least educated citizens to predatory business tactics. However, India continues to emphasize the fact that the government released specifications for the India Stack products which allowed the public to make comments before they decided to fully develop the program. In addition, they also consulted with a range of public, as well as private, groups in order to avoid privacy and cybersecurity risks.

Nevertheless, I believe this project can be very successful if the government takes the right steps and ensures that people’s privacy will not be hacked. I am very interested to see how India Stack holds up in their country because I want to see if the new biometric identity database causes any problems or if it runs smoothly. If it does, then the United States should seriously consider incorporating the use of government identification records and using this digital technology.  

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