India expands Aadhaar authentication to public and private entities; see details

In a significant policy shift, the Ministry of Electronics and Information Technology (MeitY) has expanded Aadhaar authentication services beyond government entities, allowing public and private organisations to access it for user verification. The amendment, introduced under the Aadhaar Authentication for Good Governance (Social Welfare, Innovation, Knowledge) Amendment Rules, 2025, aims to enhance digital governance, promote innovation, and improve knowledge dissemination.

Announcing the change via an eGazette notification and a post on X (formerly Twitter), MeitY emphasised that easing restrictions on Aadhaar authentication would strengthen trust in digital transactions and improve service delivery. The move is expected to benefit industries such as e-commerce, travel, tourism, hospitality, and healthcare.

How the New Aadhaar Authentication System Works

With this amendment, private firms and service providers can apply for Aadhaar authentication access, provided they meet the eligibility criteria. According to MeitY:
    •    Entities must submit a formal request detailing their intended use case to the concerned ministry or state department.
    •    The Unique Identification Authority of India (UIDAI) will examine the applications before forwarding recommendations to MeitY.
    •    Approval will be granted only after UIDAI clearance to ensure compliance with data security and privacy norms.

The new rules aim to strike a balance between user privacy and operational convenience, ensuring that Aadhaar authentication is used only for legitimate and necessary purposes.

The latest amendment revises a 2020 law that restricted private sector access to Aadhaar authentication, following a Supreme Court ruling on privacy concerns. At the time, the apex court ruled that private companies could not demand Aadhaar verification due to data security risks. However, with the new 2025 update, MeitY has carefully structured the process to ensure that only vetted organisations can access the service while maintaining strict oversight.

By granting wider access to Aadhaar authentication, the government aims to:

    •    Enhance trust in digital transactions for both service providers and consumers.
    •    Improve efficiency in services like e-commerce, healthcare, and travel by streamlining identity verification.
    •    Increase transparency in public and private sector interactions.
    •    Encourage innovation, allowing businesses to create new digital services based on secure Aadhaar verification.