Hi everyone,  

Welcome to the 150th edition of The Pattern, a weekly where we dive into the latest from the world of economy, technology and finance. There’s much to unpack as we hit this important milestone, so let’s get started! 

There's no second thought that we live in a world where digital disruption is an everyday phenomenon. One such disruption is that Aadhaar verification could now become as simple as making a UPI payment.   

Ashwini Vaishnaw , Minister for Railways, Information & Broadcasting, Electronics & Information Technology, posted on X that "Aadhaar verification becomes as simple as making UPI payment. Users can now digitally verify and share their Aadhaar details while ensuring their privacy".   

Aadhaar has transformed how Indians access services. From opening a bank account to getting a SIM card to getting linked with PAN card for IT returns. It's one number, one identity.    

Unlike what French author Voltaire said, "With great power comes great responsibility", in the case of Aadhaar great power comes with great vulnerability.   

While it’s been a gamechanger for digital public infrastructure and has eased KYC flows for most digital offerings including financial services, it’s no secret that Aadhaar has also been gamed. Repeatedly.   

In 2023, Aadhaar Enabled Payment System (AePS) frauds accounted for 11% of all cyber-enabled financial frauds in India, according to the Indian Cyber Crime Coordination Centre (I4C). These Aadhaar-related frauds often involve the cloning of biometrics. According to a report published by the Press Information Bureau in July 2024, around  29,000  incidents were reported under AePS fraud on the National Cyber Crime Reporting Portal.

Just months ago, UP Police busted a racket in Badaun and Amroha, where scammers allegedly tampered with the biometric data of 1,500 Aadhaar holders across 12 states. They collected documents from people who wanted to update or change their Aadhaar details illegally. What is even more surprising, this gang was backed by 200-300 retailers. This is a number to worry about!   

From cloning biometrics to scammers creating counterfeit websites mimicking official Aadhaar portals to uploading forged documents to fake Aadhaar scams, which are draining the victim's bank account, they are staying a step ahead. This isn't just a technology issue; by and large, it's an emotional and financial trauma for those affected. And this in a way challenges the formidability of India's digital infrastructure.   

To address these issues and more, Union Minister Ashwini Vaishnaw launched the new Aadhaar app in the national capital this week.    

How it works?  

The mobile app combines Face ID authentication and artificial intelligence, enabling users to verify themselves without physical cards or photocopies. Instead of handing over Aadhaar prints or sending soft copies via email, users can now share only the specific information they want, like their name or address, through a secure QR code, making the process as simple as using any UPI payment mode.   

"New Aadhaar App, Face ID authentication via mobile app. No physical card, no photocopies," Vaishnaw said in a video message posted on X.   

Think about this: you are a frequent traveller and must submit your Aadhaar soft copy to the front office, which exposes your Aadhaar details. This app comes as a one-tap solution. No more photocopies at hotel desks. No more worrying about where your Aadhaar image might end up. You scan a QR code, the app requests your permission, and only then is the data shared. Now, that process has become seamless, consent-driven, and, most importantly, secure.    

"No need to hand over Aadhaar photocopy at hotel receptions, shops or during travel," added the Union Minister .    

The app promises that complete control and consent lies in the user's hand. You don't have to hand over your entire identity to verify yourself. You only share what's necessary and always on your terms—be at hotels or airports or shops. Since you have the control, your data cannot be altered or misused. For businesses relying on KYC, from fintech apps to telecom partners to real estate platforms, this means faster onboarding, fewer frauds, and better user experience.   

To sum up the benefits : 

• Ensures stronger privacy, no more misuse or leaks, and protection against forgery 

• Eliminates the need for hard copies and adopting QR-based sharing 

• Reduces the friction in everyday interactions 

"Aadhaar Face authentication is becoming the hallmark of the authentication landscape. Aadhaar ecosystem has grown big and UIDAI is prepared for future be it technology adoption or service delivery", said Bhuvnesh Kumar , the CEO of UIDAI.   

Though this app is currently under beta testing , we hope that soon this will be widely used to curb the problem of document forgery, identity takeover and biometric tampering.    

As we mark a milestone with our 150th newsletter today, we want to take a moment to thank you—our subscribers—for being a part of this journey. We promise to keep bringing you more insightful updates from the world of lending and tech in the times to come. 

Reading List:  

1. Bank margins may get squeezed in gap between loan & deposit rates  

2. RBI MPC cuts repo rate by 25 bps to 6% amid market uncertainty, tariff turmoil; shifts to accommodative stance  

3. RBI plans new rules for gold loans; Manappuram, Muthoot Finance shares dive  

4. From UPI transaction limit to gold loans: Six measures announced by RBI for banks, fintechs  

Thank you for reading. If you liked this edition, forward it to your friends, peers, and colleagues. You can also connect with me on X here and follow FinBox on LinkedIn to always get all updates. 

Cheers, 

Mayank