By Srikanth Nadhamun, Founder CTO Aadhaar, Chairman Trustt, Managing Trustee eGovernments Foundation
Identity is the cornerstone of our sense of self, defining who we are within our communities and societies. It encompasses various attributes, such as language, cultural background, religion, education, and profession. While these characteristics shape our personal identities, an expanded definition of identity is necessary for states and institutions to effectively deliver services across domains like education, healthcare, banking, employment, and travel. Consequently, regulatory bodies around the world mandate “Know Your Customer” (KYC) checks, which are aimed at verifying one’s identity before granting access to services or facilities, such as opening bank accounts, obtaining loans, or acquiring mobile SIM cards.
In response to these needs, governments have issued numerous identity documents, including birth certificates, driver’s licenses, passports, ration cards, and NREGA cards, all of which play a crucial role in establishing an individual’s identity within the framework of society. However, as technology continues to evolve, the realm of digital identity verification has become an increasingly important area to conduct transactions in a digital world.
The Aadhaar Project: National ID for service delivery and Inclusion
One noteworthy example of digital identity verification’s potential lies in the Aadhaar project, which has achieved tremendous success in India. The Aadhaar system has enrolled 1.3 billion Indian residents, providing each individual with a unique identification number. This initiative has revolutionised the verification process by offering an online method for confirming one’s identity. Moreover, Aadhaar’ s KYC framework has substantially reduced the cost of identity verification, from Rs 500 ($0.6) to a mere Rs 3($0.03) per transaction. This significant cost reduction has enabled government and private sector entities to conduct transactions with unparalleled efficiency, cost-effectiveness, and reliability. Notably, Aadhaar has facilitated billions of online verifications and fast become the foundation for India’s Digital Public Infrastructure.
Identity in the Age of the Internet (Web 1.0 & Web 2.0)
The advent of the internet introduced novel challenges and opportunities for identity verification. To explain the challenge of online identity verification, the famous New Yorker cartoon depicted a dog on a computer, telling another dog, “On the internet, nobody knows you’re a dog.” This clever illustration encapsulates the dilemma of online identity. In the early stages of the internet (Web 1.0), identity verification was limited to a small number of websites, and individuals could create separate online accounts with relative ease – in this world of “Centralised Identity”.
The proliferation of online services and websites resulted in the emergence of Web 2.0, and a paradigm shift occurred. The role of an Issuer, Holder(user), and Verifier underwent a change in digital identity frameworks. Companies like Google, Facebook, and Apple seized the opportunity by offering federated identity services through OAuth, allowing users to log in to multiple websites using their trusted credentials. This model, known as “Federated Identity,” offered convenience and efficiency but raised concerns about data privacy and security. While these centralised systems initially provided a reliable means of verification, they also concentrated Identity data in the hands of a few large corporations.
Decentralised Identity (Web 3.0)
The above challenges led to the rise of Web 3.0 with its blockchain technology, ushering in the promise of “Decentralised identity” systems. In this paradigm, users are empowered to issue and manage their own credentials on blockchains without relying on “trusted” intermediary Issuers like Google, Facebook, or Apple. Technologies such as Verifiable Credentials (VC) and Digital ID standards (DID) enable the construction of such a decentralised identity system. These frameworks offer enhanced privacy since data is not centralised whereas stored in a decentralised blockchain ledger, yet fulfilling the requirements of a robust identity ecosystem.
Digital ID in the Age of Generative AI (Web 4.0?)
However, the rapid development of AI, particularly Generative AI, while providing enormous benefits, presents a clear and present danger to digital identity verification. Deep fakes—synthetic media that convincingly imitate real human speech, behavior, and appearance—pose a significant threat to the trust mechanisms carefully constructed within identity systems over time. In this increasingly likely future scenario, where AI-generated impersonations create chaos and erode trust in the system, the need for a “proof-of-personhood” verification capability likely using a person’s biometrics becomes paramount. Can we ascertain that the “person” on the other end of a Zoom/phone call is truly a human or is it a bot impersonating a human? A robust digital identity system must be able to differentiate between a human being and a robotic entity at the other end of an online connection.
This is where India’s Aadhaar project shines, as its biometric-based verification can distinguish between human residents of India and AI-generated robots that could potentially wreak havoc on trust and identity. By establishing proof of personhood or the humanness of individuals, such a system ensures the smooth conduct of government, financial and social transactions, where trust serves as the foundation for meaningful interactions in an increasingly AI-driven world.