Aadhaar: A universal Indian ID and why should you have one

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Hiral Vakil

Bank Account
Income Tax Return
Provident Fund
Last updated on February 9th, 2023

The Unique Identification Authority of India (UIDAI) was established as an attached office of the Planning Commission by the Government of India in the year 2009. The UIDAI mandated to issue a unique 12 digit number termed Aadhaar to every resident of India in order to improve the welfare services delivery of the Government.

The main objective of the Aadhaar program was to universal identity to every resident Indian. Slowly and gradually, the importance of the card has increased as compared to what it was meant for at the time of initiation. It is the world’s largest ID platform. It is also the largest biometric program in the world making India a global leader in biometric technology.

In the future, it will not only be useful but also essential to avail the benefits of various government schemes and services with ease. Listed below are the benefits of this unique id for an individual.

Digital ID Proof

People belonging to the marginalized section of the society often do not have a valid proof of identity. As a result, they miss out on availing social benefits provided by the government. It has successfully solved this problem using biometric verification of an individual to confirm the identity of its holder. It is an identification that a person can carry for a lifetime and potentially use with any service provider thus, fundamentally becoming a pro-poor identification infrastructure.

Avail LPG subsidy through Aadhaar

Under PAHAL Scheme, LPG providers transfer subsidy to Aadhaar linked bank account. To get this benefit one needs to visit their area’s distributor and get Aadhaar number link to the 17 digit LPG consumer number. So now you can get the direct benefit of subsidy by linking your bank account to the LPG number.

Proof for Passport

It is now a valid Proof of Address (POA) and Proof of Photo-Identity (POI) for a passport. 

Opening a new Bank Account/Receive monthly pension

Aadhaar letter provided by UIDAI is now accepted by the banks as a valid proof to open a bank account. It is also accepted as a proof of address with regards to the KYC procedure. So if you provide your unique id number then you are not required to provide any other proofs.

Provident Fund

For a provident fund account, it is mandatory for an account holder to register their Aadhaar card number with EPFO (Employee Provident Fund Organisation).

Open an NPS account using in a matter of minutes

A person holding an Aadhaar can open an NPS account in just 30 minutes. Till now, the only way to avail the benefit of NPS was through physical submission of application which use to take almost 15 to 20 days for processing. Now you can open an NPS account in a matter of minutes, deposit money, and manage the NPS account online.

For Jan Dhan Yojana

Pradhan Mantri Jan Dhan Yojana accepts the card as the only document sufficient to open the bank account. The benefits offered are RuPay card, free zero balance saving account, life, and accidental insurance, etc.

Accepted by SEBI

SEBI ( Securities and Exchange Board of India) accepts Aadhaar as identity proof for investing in the stock market as well as for proof of address.

Aadhaar for Income Tax Return

Income Tax Department started accepting Aadhaar Number from AY 2015-16 as means of verifying your income tax return. You can also e-verify your income tax return using Aadhaar.

After going through all these benefits, one can hardly undermine the power and importance of Aadhaar. If you consider the evolution of the Aadhaar over the years and its increasing usability, it makes much more sense to have it than to be devoid of all these benefits.

Digital Locker Service

Digital locker system launched by the Government of India for people to store all personal documents on the government’s server. Hence, to opt for this scheme one has to link their Aadhaar card number to the Digi Locker service. You can essentially store all your different documents including address and identity proofs, income proofs, PAN, bank statements, legal documents, etc. You can also e-Sign these documents using your Aadhaar number. The government is planning to incorporate the Digi Locker with different Government applications where you can directly share your e-signed documents eliminating the need to submit physically signed documents. Gradually, other service providers will also enroll to eliminate the hassle.


Do I mandatorily have to link my bank account with Aadhaar?

Post the Supreme Court judgment, it is mandatory to link your bank account with your Aadhaar number. However, if you wish to receive a subsidy or grant from the government like LPG cylinder subsidy or scholarship grant or pension benefit and so on, then it is mandatory to link your bank account with your Aadhaar number.

Can I update address details in Aadhaar even if I don’t have address proof?

Yes, you can update details in Aadhaar even if you do not have address proof. This service can be availed through UIDAI’s website under the option “Request Aadhaar Validation letter.” 

What information is contained in the e-Aadhaar QR code?

The Aadhaar QR code contains the cardholder’s demographic details such as name, date of birth, photograph, gender (if provided) and the Masked Aadhaar number.